Israel: Trade deficit widens as exports contract at a sharper pace in January
February 13, 2019
Exports contracted a steep 9.6% year-on-year in USD terms in January, constituting a sharper drop than December’s 6.6%. Trend data for November–January showed that the fall in exports came on the tails of a decrease in shipments of high technology, medium-low technology, and low technology shipments. Exports dropped for high technology goods due less foreign demand for electrotonic and boards items as well as pharmaceutical products. On the other hand, exports of medium-high technology goods increased on the coattails of strong demand for chemicals and chemical products.
Imports swung from a 3.6% contraction in December to a strong 8.2% year-on-year increase in January in USD terms. Trend data showed that imports of raw materials increased at a stronger rate while imports of investment goods recovered from a contraction in August–October. A contraction in consumer goods imports limited the expansion, however. Consumer goods fell on the back of less demand for durable goods, as imports of non-durable goods increased.
The trade deficit was stable at December’s downwardly revised USD 1.9 billion shortfall in January, although this was a marked deterioration from the USD 0.9 billion deficit in January 2018. The 12-month rolling trade deficit increased from USD 21.4 in December to USD 22.4 billion in January.
Lastly, it should be noted that with the January trade data release, the Central Bureau of Statistics switch to using a new customs system and this affected historical balance of payments, national accounts and import data.
Author: Jan Lammersen, Economist