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

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People visit the Shuk HaCarmel, or the Carmel market, in Tel Aviv on May 7, 2019.
People visit the Shuk HaCarmel, or the Carmel market, in Tel Aviv on May 7, 2019.Credit: 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.

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