Israel Inflation October 2020

Israel

Israel: Consumer prices drop at quicker pace on an annual basis in October

October 15, 2020

Consumer prices increased 0.30% in October over the previous month, swinging from September's 0.10% fall. October's reading was the sharpest increase in prices since March. The bounce back in price pressures was largely due to rising prices for food, health and clothing and footwear.

Consumer prices fell 0.8% on an annual basis in October, following September’s 0.7% decrease. The annual average variation of consumer prices fell to minus 0.4% in October (September: -0.3%). Lastly, core consumer prices fell 0.4% on an annual basis in October, which was a larger drop compared to September's 0.3% decrease.

Extremely low price pressures—which in recent months have likely been driven by depressed domestic demand and the strength of the shekel—will reinforce the Central Bank’s loose monetary stance ahead. Turning to 2021, inflation is seen returning but remaining extremely subdued, only rising back into the lower part of the Bank’s 1.0%–3.0% target range in H2.

FocusEconomics panelists see consumer prices rising 0.6% in annual terms in 2021, which is down 0.1 percentage points from last month’s forecast. Our panelists see inflation of 1.2% in 2022.


Author:, Economist

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Israel Inflation Chart


Israel Inflation October 20 20

Note: Year-on-year and month-on-month variation consumer price index in %.
Source: Central Bureau of Statistics (CBS).


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