Israel’s inflation hit 8-month high in July

Israel’s annual inflation rate surged to 3.2 per cent in July, data from the Central Bureau of Statistics showed on Thursday, marking the highest level since November 2023. The figure surpasses both the central bank and government’s target range and market expectations.

On a monthly basis, the Consumer Price Index (CPI) increased by 0.6 per cent month-on-month, with an increase in housing, food, and transport prices as well as entertainment costs driving the overall inflation rate. While some price declines in clothing and footwear and furniture, the upward trend remains dominant.

Given the latest inflation data, the Bank of Israel is likely to maintain its cautious stance on interest rates. The central bank has held its key rate steady since a cut in January, citing geopolitical tensions and inflationary pressures. The next policy meeting is scheduled for August 28.

Attribution: Reuters, The Central Bureau of Statistics (CBS), Trading Economics