Israel raises interest rates to highest level since 2006

The Israeli economy was also affected by the government’s controversial judicial reform plans earlier in the year, though the situation may normalize following the reform’s pause.
This picture taken on Aug. 23, 2022, shows a view of the exterior of the headquarters of the Bank of Israel.
This picture taken on Aug. 23, 2022, shows a view of the exterior of the headquarters of the Bank of Israel, the country's central bank, in Kiryat Ben-Gurion in Jerusalem. - AHMAD GHARABLI/AFP via Getty Images
Al Monitor: The Pulse of the Middle East
Al-Monitor Staff

Israel’s central bank raised rates again on Monday as the country continues to battle high inflation.

The Bank of Israel’s Monetary Policy Committee said it raised rates by 0.25% to 4.75%. The committee cited inflation being “above the target range” at 5% in April, according to a statement.

The Bank of Israel’s target range for inflation is 1-3%.

Why it matters: The Bank of Israel has been aggressively raising interest rates for a year to combat inflation, instituting 10 straight rate hikes since April of 2022. The current interest rate is the highest since the 5.5% set by the Bank of Israel in 2006.

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