Good news amid war, consumer prices drop in last month

Consumer prices in Israel in September surprise to the downside, the Central Bureau of Statistics says on Sunday, easing pressure on the Bank of Israel to hike interest rates later this month. Some rare good news for the country amidst a war.

The consumer price index (CPI), a measure of inflation that tracks the average cost of household goods, decelerates by 0.1% in September, compared with analysts’ expectations of an increase of between 0.1% and 0.2%, and after rising 0.5% in August.

The September print brings annual inflation over the past 12 months to 3.8%, declining from 4.1% in August, but is still above a government target range of between 1% to 3%.

That’s after Israel’s annual inflation rate dropped to 3.3% in July from 4.2% in June.

In September, notable declines were seen in the cost of transportation, which fell 1.5%, and food, culture and entertainment components decreased by 0.5%, each.

These were offset by price increases of fresh vegetables and fruit, which rose by 4.3%, educational services increased by 1.3%, and home rentals, furniture and home equipment, clothing and footwear, and health costs were up 0.5% each.