Israel’s January CPI reading above expectations

Israel’s Consumer Price Index (CPI) rose by 0.3% in January 2023, the Central Bureau of Statistics announced this evening. Analysts expected a rise of 0.1-0.2%. Over the past 12 months the CPI has risen by 5.4%, up from 5.3% last month, and the highest inflation rate in Israel for 20 years.

There were notable price rises in January in home maintenance (1.4%), health (1%), and food (0.9%).

There were notable price falls last month in clothing and footwear (4.9%), fresh vegetables (1.9%) and culture (1.6%).

Changes in home prices are published at the same time as the CPI but are not included in it. In November-December 2022 housing prices rose 0.2% in comparison with October-November, and were up 17.1% in comparison with November-December 2021, which is the lowest annual rise since February 2021.

In November-December 2022 prices of new homes fell 0.6% in comparison with October-November, but were up 20.6% in comparison with November-December 2021.

Next Monday the Bank of Israel Monetary Committee meets and had been expected to announce a 0.25% rate hike to 4%. But with the weakening of the shekel fuelling inflation by raising the price of imported goods and now the higher than expected CPI reading, some analysts predict that there could be a 0.5% hike.

Published by Globes, Israel business news – en.globes.co.il – on February 15, 2023.

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