The Consumer Price Index for March 2026 increased by 0.4%, slightly lower than our forecast of 0.5%. Over the past twelve months, the index has increased by 1.9%, similar to the central inflation target of the Bank of Israel. Apartment prices, which are not weighted in the Consumer Price Index, decreased by 0.1% in the latest survey (provisional data). Compared to the same month last year, apartment prices decreased by 1.7%. New apartment prices decreased by 0.3% this month, and excluding apartment sales, the price per inhabitant of new apartments decreased by 0.2%. Compared to the past year, new apartment prices decreased by 3.9%.
The tenant-owned housing services item increased by 0.6% this month, contributing about 0.1 percentage points to the index. The annual rate of change moderated to 3.8% from 4.5% the previous month. For apartments where there was tenant turnover, a significant increase of 5.9% was also recorded this month.<\/p>\n\n\n\n
In March, the CBS measured the prices of flights as they were booked in advance (excluding rescue flights), as well as Israeli airlines only. The result was a relatively moderate increase of 1.1% in flight prices. The section on organizing parties and events was not measured and was imputed to the index according to the overall index. <\/p>\n\n\n\n
Consumer Price Index Forecast<\/strong> Bank Hapoalim tends to estimate that although there are factors that support high inflation, such as the expected budget deficit and the tight labor market, price increases will be mainly in the short term, and during the summer months we will see inflation expectations fall back to a level below the Bank of Israel's target center, partly due to appreciation. We have updated the inflation forecast for the year ahead to a rate of 2.1%. The April forecast was updated to an increase of 1.3%, mainly due to the jump in fuel prices. <\/p>\n\n\n\n Impact on monetary policy
Fears of a wave of price increases worldwide due to rising energy prices eased slightly after the ceasefire, and the decline in the price of oil and natural gas. The impact of energy prices on inflation in Israel is less than in Europe and Asia, given the reliance on natural gas for electricity generation. There are additional factors that increase the risk of inflation in the short term: Flight prices are expected to be high towards the summer due to the avoidance of some foreign airlines from returning to Israel. Increases in rent prices for apartments with a minimum wage will be offset by decreases in rent prices for apartments without a minimum wage, but in the near term they will increase inflation. Accommodation prices in Israel are expected to be affected by the rising cost of the alternative of a vacation abroad. Oil prices have fallen again, currently around $95 per barrel of Brent crude, and are expected to affect a decrease in the price of fuel by $51\/bbl in April (if prices stabilize at their current level). The damage to oil production infrastructure in the Gulf region is expected to keep prices relatively high in the coming months. Contracts predict that the price of oil will remain at a level above $80 during the coming year. The inflationary impact of the increase in oil prices and other commodities, as well as the increase in flight prices, is offset to some extent by the sharp appreciation in the shekel exchange rate, which fell below 3 shekels to the dollar this week.<\/p>\n\n\n\n
<\/strong>The ceasefire and the sharp appreciation of the shekel exchange rate bring back the possibility of an interest rate cut this year. Markets now expect the Bank of Israel interest rate to fall to 3.75% around the summer months and a further reduction to 3.50% in early 2027. Bank Hapoalim estimates that the Bank of Israel will not intervene directly in foreign exchange trading, as the appreciation process was gradual and was influenced by expectations from players abroad and in Israel for an improvement in Israel's geopolitical situation.<\/p>","protected":false},"excerpt":{"rendered":"\u05de\u05d3\u05d3 \u05d4\u05de\u05d7\u05d9\u05e8\u05d9\u05dd \u05dc\u05e6\u05e8\u05db\u05df \u05dc\u05d7\u05d5\u05d3\u05e9 \u05de\u05e8\u05e5 2026 \u05e2\u05dc\u05d4 \u05d1-0.4%, \u05e0\u05de\u05d5\u05da \u05d1\u05de\u05e2\u05d8 \u05de\u05d4\u05ea\u05d7\u05d6\u05d9\u05ea \u05e9\u05dc\u05e0\u05d5 \u05e9\u05e2\u05de\u05d3\u05d4 \u05e2\u05dc 0.5%. \u05d1\u05e9\u05e0\u05d9\u05dd-\u05e2\u05e9\u05e8 \u05d4\u05d7\u05d5\u05d3\u05e9\u05d9\u05dd \u05d4\u05d0\u05d7\u05e8\u05d5\u05e0\u05d9\u05dd \u05d4\u05de\u05d3\u05d3 \u05e2\u05dc\u05d4 \u05d1-1.9%, \u05d1\u05d3\u05d5\u05de\u05d4 \u05dc\u05de\u05e8\u05db\u05d6 \u05d9\u05e2\u05d3 \u05d4\u05d0\u05d9\u05e0\u05e4\u05dc\u05e6\u05d9\u05d4 \u05e9\u05dc \u05d1\u05e0\u05e7 \u05d9\u05e9\u05e8\u05d0\u05dc. \u05de\u05d7\u05d9\u05e8\u05d9 \u05d4\u05d3\u05d9\u05e8\u05d5\u05ea, \u05e9\u05d0\u05d9\u05e0\u05dd \u05de\u05e9\u05ea\u05e7\u05dc\u05dc\u05d9\u05dd \u05d1\u05de\u05d3\u05d3 \u05d4\u05de\u05d7\u05d9\u05e8\u05d9\u05dd \u05dc\u05e6\u05e8\u05db\u05df, \u05d9\u05e8\u05d3\u05d5 \u05d1-0.1% \u05d1\u05e1\u05e7\u05e8 \u05d4\u05d0\u05d7\u05e8\u05d5\u05df (\u05e0\u05ea\u05d5\u05e0\u05d9\u05dd \u05d0\u05e8\u05e2\u05d9\u05d9\u05dd). \u05d1\u05d4\u05e9\u05d5\u05d5\u05d0\u05d4 \u05dc\u05d7\u05d5\u05d3\u05e9 \u05d4\u05de\u05e7\u05d1\u05d9\u05dc \u05d0\u05e9\u05ea\u05e7\u05d3 \u05de\u05d7\u05d9\u05e8\u05d9 \u05d4\u05d3\u05d9\u05e8\u05d5\u05ea \u05d9\u05e8\u05d3\u05d5 \u05d1-1.7%. \u05de\u05d7\u05d9\u05e8\u05d9 \u05d4\u05d3\u05d9\u05e8\u05d5\u05ea \u05d4\u05d7\u05d3\u05e9\u05d5\u05ea \u05d9\u05e8\u05d3\u05d5 \u05d4\u05d7\u05d5\u05d3\u05e9 \u05d1 […]","protected":false},"author":53,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[65802],"tags":[],"class_list":["post-1060001","post","type-post","status-publish","format-standard","hentry","category-65802"],"acf":[],"yoast_head":"\n