Israeli central bank faces hard choices, analysts say

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David Vaaknin

The Bank of Israel kept its policy rate unchanged at 0.25% on August 28, but it indicated a willingness to adopt future easing measures to boost below-target inflation.

In July, Israel’s consumer price index rose year on year by 0.9%, below the Bank of Israel’s annual inflation target of between 1% and 3%.

The central bank may need to contemplate using negative policy rates, one analyst told Central Banking, as several factors seem to be strengthening Israel’s shekel.

The bank’s monetary

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