Consumer Prices Register Fall for Third Straight Month

Decline in prices over past 12 months was 0.1%; drop in line with experts’ expectations.

Send in e-mailSend in e-mail
Illustration: A supermarket in Rosh Ha'ayin
Illustration: A supermarket in Rosh Ha'ayinCredit: Tomer Appelbaum

Consumer prices fell for a third straight month in November, the Central Bureau of Statistics said on Monday. But even though many economists expect another month of declines in December as well, they are discounting deflation concerns and don’t expect the Bank of Israel to lower interest rates further.

The consumer price index fell 0.2% last month, bringing the decline in prices over the past 12 months to 0.1% or, not counting housing prices, 1%, the CBS said. The big declines in November were in transportation and communications prices, which fell 1.2% and 0.9%, respectively.

Food prices were down 0.2%, with fresh produce prices down 5.3%.

“The CPI declined more or less within expectations. We are expecting price rises to remain low, among other things because of sharp competition in the food industry,” said Idan Azoulay, head of investments at Epsilon Investments. “We assume that the Bank of Israel won’t adjust interest rates in the coming month.”

Ayalet Nir, chief economist at Yetzirot Investment House, said the December CPI would also be negative due to scheduled rate cuts for water, electricity and the continued decline in world petroleum prices.

The central bank’s base lending rate is at a record low 0.25%, amid low inflation and expectations in the capital market that prices will rise just 0.4% in the next 12 months – well under the government’s target of 1% to 3%.

While fears about deflation and its negative impact on consumer spending have receded, some economists said Monday that the central bank may take measures to spruce up economic growth.

Jonathan Katz, economist at Leader Capital Markets, said the one concern is housing prices. Rents rose 2.9% in the 12 months through November, a faster pace than in October as well as the 1.4% rise registered in the CBS’ last housing price survey.

Click the alert icon to follow topics:

Comments

SUBSCRIBERS JOIN THE CONVERSATION FASTER

Automatic approval of subscriber comments.

NOW: 40% OFF
Already signed up? LOG IN

ICYMI

הקלטות מעוז

Jewish Law Above All: Recordings Reveal Far-right MK's Plan to Turn Israel Into Theocracy

איתמר בן גביר

Why I’m Turning My Back on My Jewish Identity

Travelers looking at the Departures board at Ben Gurion Airport. The number of olim who later become yordim is unknown.

Down and Out: Why These New Immigrants Ended Up Leaving Israel

Beatrice Grannò and Simona Tabasco as Mia and Lucia in "The White Lotus."

The Reality Behind ‘The White Lotus’ Sex Work Fantasy

The Mossad hit team in Dubai. Exposed by dozens of security cameras

This ‘Dystopian’ Cyber Firm Could Have Saved Mossad Assassins From Exposure

מליאת הכנסת 28.12.22

Comeback Kid: How Netanyahu Took Back Power After 18 Months in Exile