Business in Brief

Send in e-mailSend in e-mail

Gasoline prices to go down 4%

Gasoline will cost about 4.1% less starting Tuesday night at midnight. The regulated price for 95-octane at the self-service pumps will be NIS 7.26 a liter as of May 1, 31 agorot less than it currently costs. The charge for full-service will remain 18 agorot per liter. The price reduction follows an 8.5% drop in wholesale gas prices in Europe − the determining factor used by the Energy Ministry in setting the local regulated rate − as well as a 1.2% increase in the value of the shekel against the U.S. dollar. The base price is boosted by a marketing margin for fuel companies of 64 agorot plus duties totaling NIS 3 per liter, with value-added tax raising the cost by an additional 17%. Taxes account for 56% of the overall price of gasoline in Israel. ‏(Itai Trilnick‏)

Layoffs grew in first quarter, but so did hiring

A survey released Sunday by the Economics Ministry has both bad news and good news for the labor sector: Layoffs in the first quarter soared to 25,600 from 15,000 in the previous three months. But the number of people who were hired outpaced the number who left their jobs by 11,400 a month, compared with 7,300 the previous quarter. This was due to a 6.8% rise in the hiring rate, as opposed to a much slighter 1.8% increase in attrition. “The last quarter shows a certain improvement in the labor market, but not all indicators we follow attest to a rosy picture,” said Benny Pfefferman, head of the ministry’s research department. ‏(Hila Weissberg‏)

Home prices climbed 7% over six months

The government has failed to moderate the rise in homes prices, which climbed 7% in the six months through February, the Knesset Research and Information Center said in a report to the Finance Committee Sunday. After a period of stability from August 2011 to August 2012, home prices began to climb at a monthly average rate of 1.14% through last February, the report said. That rate exceeds the 0.7% monthly average in the four years through August 2011. Tamir Agmon, who helped prepare the research, attributed the rise to lower interest rates, brisk economic growth since 2004, and more Israelis entering the workforce, which increased demand and buying power. The committee will hold a debate on the subject Monday, with Bank of Israel Governor Stanley Fischer participating. ‏(Zvi Zrahiya‏)

Business-sector debt declined in February

Debt owed by Israel’s business sector declined 0.1% to NIS 785 billion in February, thanks mainly to a stronger shekel, which reduced the value of liabilities, denominated in foreign currency, the Bank of Israel reported Sunday. The Bank of Israel said that NIS 1.4 billion in bonds were issued in March by businesseses not including banks and insurance companies, mostly through tradable securities. This was notably less than in the first two months of the year, when newly issued bonds averaged NIS 3.2 billion a month. Meanwhile household debt dropped 0.2% in February to NIS 385 billion, despite its home mortgage component rising by NIS 1 billion to NIS 272 billion at month’s end. ‏(Moti Bassok‏)

Stanley Fischer argued that a higher deficit target would endanger the economy. Credit: Tomer Appelbaum