Bank of Israel Keeps its Key Interest Rate at 0.10%

June 22, 2015

The June meeting of the Monetary Policy Committee in Israel ended with a decision not to ease the ultra-accommodative stance any further, and market indications of rate expectations have sliced the probability of more easing according to a statement released by the Bank of Israel.  The rate had been cut by 75 basis points each in 2011, 2012, 2013, and 2014.  This year’s only reduction, made in February, was by 15 basis points.  Although on-year CPI inflation of negative 0.4% remains well below the 1-3% target, prices went up 0.2% compared to April, and expected inflation has edged marginally above the target floor.  Officials expect consumer prices to climb around 1.6% over the coming twelve months.  But the shekel is still rising, and global GDP growth prospects have dimmed somewhat.

Copyright 2015, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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