The Bank of Israel may emulate Switzerland and the Czech Republic in setting a floor for the shekel, as the currency trades near its strongest in 31 months, according to HSBC Holdings Plc.
Israel’s economy will probably expand 4.1 percent this year, powered by exports, consumer spending and home construction, the Central Bureau of Statistics said.
Israeli consumer prices rose less than expected in April, slowing inflation to the lower limit of the government’s target and reviving the possibility of a further interest-rate cut.
Bank of Israel Governor Stanley Fischer raised the benchmark interest rate for the first time in four months in a bid to cool housing prices which he says could develop into a bubble.
Bank of Israel Governor Stanley Fischer, who last week unexpectedly cut the benchmark interest rate to a three-year low, may not be done yet, according to Jonathan Katz, an economist at HSBC Holdings Plc.
Israel’s failure to cap a surge in housing prices threatens to add a new drag on an already slowing economy.
Israeli inflation probably eased in July, remaining within the target range for a fourth month, following government cuts in taxes on consumer goods and water.
Ehud Barak, the former Israeli prime minister, doubled his money when he sold an apartment in north Tel Aviv’s Akirov Towers that he’d bought in 2003 for about 12 million shekels ($3.5 million).
Israel’s inflation rate fell for a fourth consecutive month in April, dropping within the government’s target range for the first time since October.
"As long as rates are so low and with a very real possibility and likelihood that the Bank of Israel will cut rates further, be it this month or next, this is a great opportunity for corporations to issue debt."
- Jonathan Katz on Jun 08, 2014