Israel Marks Sixth Year of Almost No Inflation, but House Prices Continue to Rise

Consumer price index rose 0.6% in 2019, while housing prices rose by as much as 5%

People visit the Shuk HaCarmel, or the Carmel market, in Tel Aviv on May 7, 2019.
JACK GUEZ / AFP

Israel marked its sixth consecutive year of low or negative inflation in 2019. The Central Bureau of Statistics reported on Wednesday that the consumer price index rose just 0.6% last year, down from 0.8% in 2017.

In December 2019, the CPI was unchanged.

Taking into account three years of negative inflation in 2014-16, the CPI has risen just 0.4% since 2013, putting it far below the target ranges of 1% to 3% set by the government.

In a year of otherwise very low inflation, the May 2019 CPI jumped 0.7% but the following month it fell 0.6%. The biggest price rises for the year came for apparel and shoes, which rose 5.5%. Prices of fresh produce and home furnishings and equipment rose by 2.5%.

The housing cost index, which accounts for nearly a quarter of the total CPI, climbed 2.1%, accelerating from a 1.9% increase in 2018.

By comparison, housing prices, which are not included in the CPI and whose data lag behind it, showed a 0.5% increase in prices over October-November versus September-October. Annualized, that worked out to a 3.4% rise, its fastest in two years,

In terms of 12-month price rises for housing, Tel Aviv led with a 5% increase. The northern district saw a 4.1% increase, the Jerusalem district a 2.8% gain.