September Consumer Price Index Unchanged

Economists caution that zero inflation signals slowing economy.

Israeli inflation was nil in September, leaving the inflation rate at 1.8% since the start of the year, the Central Bureau of Statistics reported yesterday. Economists said that reflected a weakening economy.

The price of fresh vegetables rose 4.7% in the month, education by 3.4% and food overall by 0.5%. But those rises were offset by a 9.1% drop in fresh-fruit prices, a 2.7% drop in entertainment and culture costs and a 1.4% drop in apparel prices, the CBS said.

"The consumer price index provides a further indication that the Israeli economy is slowing," said Shmuel Ben-Arye, research director at Pioneer Financial Planning.

"The low CPI shows that consumer demand, which is the catalyst for economic growth, is tepid. The Israeli shopper doesn't want to spend before he sees the effect of the government's economic program and he is worried about rising unemployment."

Ofer Vaknin