Israel’s Inflation Drops to 3.1%, Lowest in Nearly a Year By The Media Line Staff Israel’s annual inflation rate dropped to 3.1% in May, down from 3.6% the previous month, according to figures released Sunday by the Central Bureau of Statistics. This is the lowest year-on-year rate recorded since June 2024, when inflation stood at […]
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The Media Line: Israel’s Inflation Drops to 3.1%, Lowest in Nearly a Year
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Israel’s Inflation Drops to 3.1%, Lowest in Nearly a Year
By The Media Line Staff
Israel’s annual inflation rate dropped to 3.1% in May, down from 3.6% the previous month, according to figures released Sunday by the Central Bureau of Statistics. This is the lowest year-on-year rate recorded since June 2024, when inflation stood at 2.9%.
The decline moves inflation closer to the government’s official target range of 1% to 3%. The development could prompt the Bank of Israel to reconsider its monetary policy stance, including the possibility of lowering the base interest rate, which has held steady at 4.5% since January.
The consumer price index, which tracks changes in the cost of goods and services, fell by 0.3% in May. That figure follows a sharp 1.1% increase in April, the highest monthly jump since July 2022. A significant factor behind the May decline was a 7.9% drop in airline ticket prices, contributing to a 2.4% decrease in the broader transport and communication sector.
Israel’s central bank has faced pressure in recent months to strike a balance between curbing inflation and supporting economic growth. While inflation had remained above the target range for much of the past year, the recent easing may offer room for more accommodative policy in the months ahead.
The Israeli economy, like many around the world, has experienced inflationary volatility since the COVID-19 pandemic and the onset of the war with Hamas in October 2023, which disrupted supply chains and drove up energy and transportation costs.