Israel Set to Hold Rates as War Drags On and Inflation Builds [BNN Bloomberg (Canada)]
BANK HAPOALIM B.M. S/ADR (BKHYY)
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Source: BNN Bloomberg
Analysts surveyed by Bloomberg are unanimous in forecasting that the Bank of Israel will hold its key rate at 4.5% on Wednesday. An announcement is scheduled at 4 p.m. local time. While major central banks such as those of the US, euro zone and UK are either starting to cut rates or expected to do so soon, Israel is having to put off easing. After starting the year with a rate cut, the Bank of Israel has had to shift gears and focus on the growing financial and economic fallout of the war against Hamas in Gaza and tensions with other Iran-backed militant groups such as Hezbollah. “The Bank of Israel will continue to err on the side of caution near term, especially as the geopolitical environment remains tense,” Anatoliy Shal, an analyst at JPMorgan Chase & Co., said in a recent note. He expects a first cut, of 25 basis points, will come in November, followed by another 50 basis points of easing by the middle of 2025. Still, the central bank may, he said, be forced into “a more
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