JERUSALEM (Reuters) – Israel’s economy bounced back in the second quarter after a contraction in early 2022, the Central Bureau of Statistics said on Tuesday, citing gains in exports and consumer spending.
Gross domestic product (GDP) grew by an annualised 6.8% in the April-June period from the prior three months, compared with a forecast in a Reuters poll of analysts of a 2.8% rise.
The economy shrank 2.7% in the first quarter, a downward revision from a prior 1.8% contraction.
The economy grew more than 8% in 2021 and is expected to grow a further 5% in 2022, according to the Bank of Israel.
Despite a weak start to the year, the central bank has raised short-term interest rates in a bid to contain rising price pressures.
On Monday, the bureau said that Israel’s annual inflation climbed to a 14-year high of 5.2% in July from 4.4% in June and as a result policymakers are expected to raise the benchmark rate at least a half-point at its next decision this Monday. The rate stands at 1.25%, up from 0.1% in April.
In the second quarter, exports and private spending grew about 10%, while investment rose 7.7% and government spending gained 5%.
(Reporting by Steven Scheer; Editing by Ari Rabinovitch and Tomasz Janowski)
