For the 11th time in a row: The Bank of Israel left the interest rate unchanged - and it will remain at 4.5%.
The bank's monetary committee decided not to lower the interest rate after inflation climbed beyond expectations in April and reached 3.61% - above the upper range of 3.1% set by the bank, and against the backdrop of uncertainty in the markets and the deepening fighting in the Gaza Strip.
Among the Monetary Committee's reasons for the decision is its focus on stabilizing markets and reducing uncertainty amid the continued fighting, alongside price stability and support for economic activity. The interest rate path will be determined in accordance with inflation convergence to its target, continued stability in financial markets, economic activity, and fiscal policy.
Although the interest rate has remained unchanged in recent months, the Bank of Israel estimates that in the first half of 2026 the interest rate will drop to 41.3%.
That is, the estimate is that by 2026 there will be two interest rate cuts.
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