March Israeli CPI Surges
Written by: Aaron Katsman | April 16, 2009
No economic growth, a stable currency, and yet the March CPI figure jumped by 0.5%.
According to Ynet: ” The Consumer Price Index (CPI) rose by 0.5% in March compared to February, the Central Bureau of Statistics (CBS) said Tuesday, following four months of price reductions in light of the recession. Analysts were surprised by this figure in light of pre-estimations pointing to a stable CPI or a price-hike of up to 0.2%. Since the beginning of the year, the CPI has fallen by 0.1% on the backdrop of rise in unemployment, the cutting down of production and the drop in demands.”
The jump was led by higher fuit and vegatable prices as well as higher housing costs. This will surely mean that BOI head Stanley Fischer will hold interest rates steady for the time being.
If we see continued higher CPI readings we may start seeing higher interest rates. That could delay any Israeli economic recovery.
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