Israel: Inflation comes in at highest level since November 2008 in June
July 15, 2022
Consumer prices increased 0.38% in June over the previous month, which was below the 0.57% rise logged in May. The result was primarily due to a more moderate rise in prices for food. Moreover, prices for clothing and footwear dropped.
Despite the softer month-on-month price rise, inflation came in at 4.4% in June, which was up from May’s 4.1%. June's figure marked the highest inflation rate since November 2008 and was well above the Central Bank’s 1.0–3.0% target range. Meanwhile, the trend pointed up, with annual average inflation coming in at 3.1% in June (May: 2.8%). Finally, core inflation rose to 3.9% in June, from May’s 3.8%.
On top of higher international commodity prices, recent inflation in Israel has being driven by the marked depreciation of the shekel in recent months and a tight domestic labor market. That said, price pressures remain mild relative to most other developed economies due to a limited reliance on energy imports.