Governor Amir Yaron said the bond buying program will end in November-December. The Bank of Israel raised its growth forecast.
The Bank of Israel Monetary Committee, headed by Governor Prof. Amir Yaron, has kept the interest rate unchanged at its historic low of 0.1%.
The Bank of Israel Research Department has said that the interest rate range would be between 0.1%-0.25% at the end of the year. The bank is not concerned about inflation which it sees at 2.5% in 2021 and falling to 1.6% in 2022. The Bank of Israel sees inflation of 1.7% over the next 12 months.
The Bank of Israel has revised its GDP growth forecast upwards to 7% from 5.5% and sees 5.5% growth in 2022. The bank expects the government to pass the budget next month and sees the budget deficit narrowing to 6.4% of GDP in 2021 and 4% in 2022. The ratio of debt to GDP will be 73.5% in 2021, the Bank of Israel forecasts, and 73% in 2022.
In a press conference convened after the announcement Yaron said, "As long as nothing extreme happens the bond purchasing program will end in November-December."
Published by Globes, Israel business news - en.globes.co.il - on October 7, 2021
Copyright of Globes Publisher Itonut (1983) Ltd. 2021
Amir Yaron Photo: Yonatan Bloom