Bank of Israel

November 23, 2015

The released statement following this month’s monetary policy meeting has a dovish tone, although Israel’s monetary policy interest rate of 0.15% was not cut further.  It had been reduced previously by 75 basis points a year in four consecutive years plus by a further 15 basis points in the February of this year.  The statement mentions recent slippage downward in both short- and medium-term expected inflation but a still anchored long-term inflation rate in the middle of the central bank’s 1-3% target range.  The recent renewed slide of world commodity prices also is noted.  At-trend growth has resumed, and officials detected no immediate drag on growth from the recent escalation of geopolitical violence.  The shekel remains buoyant, holding its own against the dollar and rising on a trade-weighted basis.  That’s not desirable with sub-zero inflation (-0.7% on year in October).

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

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