(August 23, 2022 / JNS) The Bank of Israel on Monday raised its benchmark interest rate by 0.75 percent in a bid to curb inflation that has topped 5% over the past 12 months.
The hike to 2.0% from 1.25% was the central bank’s biggest in two decades, and analysts believe additional increases are on the horizon, according to a Reuters report.
The interest rate stood at 0.1% in April, an all-time low set at the onset of the coronavirus pandemic, according to the report.
“We understand the pain of those taking loans, taking mortgages, but the pain today is to prevent a much greater pain in the future,” Bank of Israel Governor Amir Yaron told Channel 13 in reference to the hike.
He added that the bank remains determined to get inflation back within the 1-3% annual target.
In July, the Bank of Israel raised the interest rate by 0.5% after inflation in the country crossed “the upper bound of the target range,” at the time 4.1 percent.
Looking ahead, the bank said that it expected inflation to return to “within the target” range in 2024, and then the following year it would have “converged back to the midpoint of the range.”
Jewish News Syndicate
With geographic, political and social divides growing wider, high-quality reporting and informed analysis are more important than ever to keep people connected.
Our ability to cover the most important issues in Israel and throughout the Jewish world—without the standard media bias—depends on the support of committed readers.
If you appreciate the value of our news service and recognize how JNS stands out among the competition, please click on the link and make a one-time or monthly contribution.
We appreciate your support.