Israel: Exports contract sharply in April, while imports stagnate
May 19, 2019
Merchandise exports contracted 18.0% year-on-year in April in USD terms, contrasting March’s 12.7% growth. Imports were down 0.1%, contrasting March’s 4.9% growth, while the trade deficit widened from USD 1.2 billion in March to USD 2.5 billion in April.
Looking at trend data for February-April, export growth slowed notably from the previous rolling quarter, likely weighed on by the stronger shekel. While exports of higher-tech exports were up year-on-year, lower-tech exports declined in annual terms. Turning to imports, Q1 trend data reveals sharp rises in consumer and investment goods, and fuel, likely supported by strong domestic demand and a surge in vehicle imports ahead of environmental tax changes.
Looking ahead, a global economic slowdown and trade tensions will likely weigh on exports, while import growth should moderate sharply on a tough base effect.
Author: Oliver Reynolds, Economist