Barclays Capital has published a highly positive quarterly survey of the Israeli economy entitled "Economic fundamentals look even better." Barclays sees growth accelerating and has its 2010 growth forecast from 3.3% to 3.7% and its 2011 growth forecast from 3.5% to 4%.

Barclays Capital said, "We are becoming more confident about the durability of Israel growth given higher-than-expected second quarter real GDP, and its composition."

Barclays Capital sees inflation decelerating and forecasts 2.2% for 2010 and 2.5% for 2011. Barclays feels that lower inflation will enable Bank of Israel Governor Stanley Fischer to raise the interest rate from its current level of 1.75% to 3% with gradual rises every three months.

Regarding foreign currency exchange rates, Barclays Capital sees the shekel dollar rate staying at the NIS 3.70/$ through 2010 and 2011.

Published by Globes, Israel business news - www.globes-online.com - on September 26, 2010

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