CPI up 0.3% in April, well below expectations

Israel’s Consumer Price Index (CPI) rose 0.3% in April 2021, the Central Bureau of Statistics reports, well below analysts’ consensus of 0.6%. Since the start of 2021, the CPI has increased by 1.1% and over the past 12 months the CPI has increased by 0.8%.

The relatively low inflation figure for April reinforces the Bank of Israel’s belief that inflation has stabilized between 1% and 2.5% per year. According to the most recent statement from Bank of Israel Governor Amir Yaron, it would take a real “jump” in inflation to change policy. It seems the Bank of Israel was right and the 0.6% rise in the CPI in March was a temporary aberration.

In April, the prices of fresh fruits and vegetables 3% and clothes and shoes (2.8%) and food (0.7%) and significant price reductions in communications (1.2%) have been significant.

The house price index, which is separate from the CPI, continued to grow during the February-March period, compared to January-February, increasing by 0.8%. House prices have increased 4.5% in the past 12 months.

In February-March compared with January-February, house prices in central Israel increased by 1.2%, in the north prices increased by 1.1%, in the south prices increased by 1%, in Tel Aviv 0.6%, in Haifa 0.2%, while prices fell in Jerusalem 0.3%.

In the past 12 months, prices have increased 6.6% in the south, 5.7% in the north, 5.3% in central Israel, 3.7% in Tel Aviv, 3.2 % in Haifa and 0.8% in Jerusalem.

Posted by Globes, Israel Business News – en.globes.co.il – May 14, 2021

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