The Bank of Israel says it will keep the interest rate changed at a low 0.1 percent, despite Israel’s strong economic recovery from the pandemic.
The bank says economic activity is at a “high level” despite the pandemic, but cites the risk of more COVID outbreaks and continued uncertainty.
It says inflation was 3.1% over the past year, at the upper end of the bank’s target range. Inflation is expected to remain within the bank’s target range in the coming year, as well as long-term.
Omicron’s impact on the global economy has been “relatively moderate,” and economic activity continues to recover, the bank says.
The shekel has weakened against the dollar and the euro, the bank says. A strong shekel had been hurting Israeli exporters and producers.
Israel’s GDP grew by 8.1% last year, surpassing previous forecasts and marking the highest financial growth rate recorded in Israel in 21 years.
The entrance to Tel Aviv Stock Exchange, in the center of Tel Aviv, December 25, 2018. (Adam Shuldman/Flash90)
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