Capital Market

Senior officials in Israel’s economy, after meeting with economists from Standard & Poor’s and Moody's, have raised concerns that an all-out war with Hezbollah—and potentially Iran—could lead to an immediate downgrade of Israel’s credit rating. These meetings highlighted the rating agencies' apprehension about the continued conflict in Gaza and along the Lebanese border and the increasing strain on Israel’s fiscal stability

The Israel Innovation Authority published its annual report today, summarizing the state of the country's high-tech sector since the outbreak of the Iron Swords War on October 7. The report highlights concerning trends, including a slowdown in recruitment, changes in the industry’s workforce composition, and declining attractiveness to foreign investors

Starting at midnight between Monday and Tuesday, the price of 95 octane gasoline in self-service stations will decrease by 13 shekels, bringing it to NIS 7.16 per liter (including VAT). This marks the third consecutive decline since August

In a significant financial move, S&P Global Ratings announced on Wednesday night that it has downgraded Israel's credit rating from A+ to A, now accompanied by a negative outlook. This change suggests that further downgrades could occur in the near future

According to the Central Bureau of Statistics, the consumer price index (CPI) for October rose by 0.5% compared to the previous month. Still, annual inflation held steady at 3.5%, the same rate as during the corresponding period last year. Despite the monthly increase, the overall inflation rate remains within the government’s target range, though it continues to challenge economic policymakers

The Likud party has proposed a new law to establish a political investigation committee to probe the October 7 massacre, which will replace the state investigation committee as outlined in existing legislation. The proposed law stipulates that the events surrounding the massacre cannot be investigated by any other means than those set forth within this bill, limiting investigative channels exclusively to the committee's framework

In a move that signals ongoing economic adjustments, the Israeli government has approved a second increase to the 2025 state budget deficit in less than a month. The revised deficit for next year’s budget has been set at 4.4%, up from the previously approved 4.3%, amounting to an additional 80 billion shekels. The decision to raise the deficit was almost unanimous, with the sole exception being Minister Gila Gamliel, who voiced her opposition

The Bank of Israel has decided to maintain its key interest rate at 4.5% for the seventh consecutive time, reflecting the ongoing economic uncertainty and geopolitical challenges. The decision follows an upward revision of the state budget deficit for 2025 and persistent inflationary pressures within the Israeli economy

According to data released today by the Central Bureau of Statistics, the average salary for an employee position in Israel increased by 5.1% in 2024, reaching NIS 13,514 compared to NIS 12,863 in 2023. This growth significantly outpaced the consumer price index (CPI), which rose by 3.2% during the same period. However, this wage increase also has a downside for National Insurance benefits, which are linked to the CPI and are expected to be eroded by approximately 2%