February uptick in inflation takes forecasters aback
The consumer price index rose 0.3% in February, surprising economists, who had predicted it wouldn't increase at all.
That means inflation is higher than Israel's analytical community had thought.
The behavior of consumer prices strengthens the prevailing opinion that Bank of Israel Governor Stanley Fischer will raise interest rates in April for the third month in a row.
If he does raise the rate, presumably (but not definitely ) by a quarter-percent, the central bank's interest would be 2.75%.
The culprits behind the surprisingly high February CPI were fresh fruit and vegetables, which increased 5.7% over January; and the 1.2% increase in the general food index. Blame the world commodities market: The price of cocoa, for instance, jumped 11.9% in February; sugar rose 6.6%; coffee was up 6.3%; eggs, 5.6%; and cooking oil, 5.3%.
Strawberries increased nearly 50% in price last month, and bananas were up 23.4%. Cabbage on the other hand fell by 26%, and broccoli, by 22%. The kids will surely be delighted.
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