Bank of Israel Keeps Interest Rate at 4.5% for the 12th Consecutive Time

SadaNews - On Monday, the Bank of Israel maintained the interest rate at 4.5% unchanged, marking the twelfth consecutive time, despite the inflation rate nearing the upper limit targeted by the bank.

The bank's monetary committee stated that the decision to keep the interest rate unchanged was made as the annual inflation rate continues to stand at 3.1%, which is very close to the bank's upper target limit of 3%.

The committee indicated that the economic environment still requires caution in setting a policy for lowering interest rates, especially given the uncertainty associated with the ongoing war and its implications for the local market.

The Bank of Israel did not specify a precise date for lowering the interest rate, but hinted in its forecasts that it may be gradually reduced during the first half of 2026, reaching 4%.

It is noteworthy that the current interest rate is the highest in more than a decade, having remained at this level since mid-2023, in an effort to curb inflation after a series of continuous increases.

The monetary committee is monitoring local and global economic indicators, including commodity prices, the labor market, and investment activity, to determine the appropriate timing for any changes in monetary policy.