Israel: Inflation returns to the Central Bank’s target range in January
Consumer prices dropped 0.1% over the previous month in January, a less pronounced fall than December’s 0.3% decrease in prices. January’s print reflected cheaper clothing, vehicle fuel and lubricants, and owned dwellings services. Markedly more expensive electricity, gas and water limited the drop in prices compared to the previous month. It should be noted that the price basket was updated with the January release while the base year also changed from 2016 to 2018. This influenced the month-on-month variation in the price level.
Inflation increased to 1.2% in January from 0.8% in December and returned to the Bank of Israel’s 1.0%–3.0% target range after a brief stint outside of it in December. Annual average inflation edged up from 0.8% in December to 0.9% in January. Lastly, core inflation, which excludes volatile energy prices, rose to 1.4% in January from 1.0% in December.