A new era began? US Federal Reserve raised the interest rate by 0.25% - Israel might be next

A new era began tonight in the financial world. After a long period in which most countries around the world had a particularly low level of interest rates, the US Federal Reserve raised the interest rate from 0 to 0.25% - to 0.25% to 0.5%, for the first time since December 2018.
Despite previous estimates that the war in Ukraine could delay interest rate hikes - high inflation, resulting from rapidly growing consumption as the Corona crisis subsided, overcame the war and led to the beginning of US interest rate hikes.
The implication of raising interest rates tonight in the leading economic power is that very soon the interest rate will rise in dozens of other countries, including Israel. However, among the Western countries it was already a pioneer in raising interest rates, the United Kingdom, with its central bank raising interest rates twice already, last December and January this year, to 0.5%.
The increase in demand for products and services, with the decline of the corona crisis in the world and in Israel, has accelerated the rise in prices in recent months, while on the other hand the decline in supply, due to problems and delays in production and sea transport, has led to such permanent increases.
As a result, inflation in the US has already risen to a record rate of 7.5% in the last 12 months, and in the 34 developed countries belonging to the OECD (including Israel), average inflation has already jumped to 7.2% in January, in European countries it is close to -6% and in some countries it itches and even passes the 10%, such as in Estonia (11.3%) and the Czech Republic (9.9%).
Federal Reserve Chairman Jerome Powell said at the press conference of the interest rate decision that he expects inflation to return to 2%, but that it will take longer than previously estimated. "As long as the labor market remains strong we expect inflation to moderate Towards the 2%, "Powell said.
In Israel, inflation in the last 12 months is still relatively low compared to the rest of the world (3.5%), despite the wave of price increases we have experienced since the beginning of the year and has already accumulated to 0.9% in the first two months of 2022. 1% to 3% - the target set continuously since 2002 - and in this situation there is currently no escape from raising interest rates in Israel, probably already in the forthcoming announcement by the Bank of Israel on 11 April. The forecast is that the interest rate in Israel will rise from 0.1% to 0.25%.
An increase in the basic interest rate in Israel will immediately lead to an increase in the prime interest rate from 1.6% today to 1.75%, and it is likely that further interest rate increases will be made later this year. The implication is immediate: a certain curb is expected in the rise in prices in the economy, including that of apartments, due to the rise in mortgage prices. This is already a good result, after it became clear on Tuesday that the rise in apartment prices in the country has already reached a peak in 11 years - 13% per year.
The world is entering a new era tonight, where experts estimate that interest rates will begin to gradually climb to the heights we knew years ago. In the US, there are already forecasts of 3-5 interest rate hikes by spring or summer next year and the interest rate will reach 1.5%. In Israel, forecasts are more moderate, but some forecasters expect a full percentage interest rate in about a year.