Israel Economic Outlook
May 7, 2019
The economy likely lost some momentum in annual terms in the first quarter, with the manufacturing PMI averaging notably lower than in Q4. Nevertheless, growth should still have been solid, supported by the expansionary fiscal stance and a healthy labor market. The State of the Economy Index recorded solid readings throughout Q1, while business confidence was robust. On the political front, incumbent Benjamin Netanyahu’s Likud party and rival Benny Gantz’s Blue and White coalition both obtained 35 seats in parliament in a general election held on 9 April. Agreements with smaller parties should give Netanyahu a majority, although coalition talks are still ongoing. Economic policy is thus unlikely to change significantly, with a continued focus on keeping taxes low and boosting competitiveness. However, political instability is possible given the fractured parliamentary arithmetic.Israel Economic Growth
Growth should be sprightly this year, supported by loose fiscal policy, strong wage growth and healthy external demand for high-tech exports. Moreover, the development of the Leviathan gas field should boost investment. Geopolitical tensions—particularly with Gaza following recent conflict—and rising trade protectionism pose downside risks to growth. FocusEconomics analysts expect growth of 3.2% in 2019, which is unchanged from last month’s forecast, and 3.4% in 2020.Israel Economy Data
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Israel Facts
| Value | Change | Date | |
|---|---|---|---|
| Bond Yield | 2.00 | -1.69 % | May 13 |
| Exchange Rate | 3.57 | -0.37 % | May 13 |
| Stock Market | 1,420 | -0.91 % | May 13 |
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Israel Economic News
Israel: Consumer and business sentiment improve in April
May 16, 2019
Confidence among Israeli households improved from minus 8 in March to minus 7 in April.
Israel: The economy gains pace in the first quarter, although temporary factors flatter the headline reading
May 16, 2019
The economy expanded 5.2% in quarter-on-quarter seasonally adjusted annualized rate (qoq SAAR) terms.
Israel: Inflation dips in April but remains within the target range
May 15, 2019
Consumer prices rose 0.3% in April over the prior month, down from March’s 0.5% rise, amid notably higher prices for clothing and footwear, fresh fruit and transportation.
Israel: Economic activity index continues to show solid momentum in March
April 30, 2019
The Bank of Israel’s Composite State of the Economy Index rose 0.29% in March over the previous month, down slightly from February’s revised 0.33% growth (previously reported: +0.32% month-on-month).
Israel: Manufacturing PMI picks up in March
April 17, 2019
The Purchasing Managers’ Index (PMI), produced by Bank Hapoalim and the Israeli Purchasing & Logistics Managers Association (IPLMA), rose from 49.6 in February to 52.2 in March, moving above the neutral 50-point mark separating contraction from expansion in the manufacturing sector. The change in the headline figure was driven by stronger growth in domestic demand, production and employment.
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