Bank of Israel: Pillar of Defense has little effect on Israeli economy

Click photo to download. Caption: A Gaza rocket in an Eshkol Regional Council field during the latest conflict. Credit: Ronit Minaker.( Operation Pillar of Defense had a minimal impact on the Israeli economy, according to the Bank of Israel.

The bank on Monday released meeting minutes that revealed the Jewish state’s interest rates remaining at 2 percent. In the same minutes, Monetary Committee members commented on economic the impact of the Israel-Gaza conflict, Globes reported. 

“Committee members were in agreement that the recent military operation in the Gaza Strip did not have marked effects on the present and future growth rates of the economy, and that there were only moderate effects on the foreign exchange and capital markets,” the minutes said. “Committee members project a one-time addition to defense expenditures in order to replenish inventories, but it is too early to assess if this will have an effect on the overall budget.”

According to the minutes, activity in the Israeli construction industry “is strong compared with its levels in the past decade.” 

“The number of building starts remains high and is expected to continue to be reflected in an increased stock of homes,” the minutes said.

Posted on December 11, 2012 .