CPI unexpectedly fell in July, home prices rising

Fresh produce Photo: Tamar Matsafi
Fresh produce Photo: Tamar Matsafi

Israel's Consumer Price Index fell by 0.1% in July as inflation moves deeper into negative territory.

Israel's Consumer Price Index (CPI) fell by a surprising 0.1% in July, the Central Bureau of Statistics reported this evening. The analysts' consensus had been for a rise of 0.1%. In June the CPI fell by an unexpected 0.7%.

In recent months the inflation rate has again turned negative, and the figure for the twelve months to July is minus 0.7%. Only four months ago inflation was running at an annual rate of 0.9% and approaching the government target of 1%-3%.

Prices of fresh fruit and produce fell 2% last month, clothing and footwear prices fell 8.1% and furniture and household equipment fell 0.9%. Prices of fresh fruit rose 1.5% last month, and apartment rents rose 0.9%.

In a comparison between home prices in May-June 2017 with prices in April-May 2017, the index of home prices rose slightly, by 0.1%. In comparison with the May-June period in 2016, prices rose 4.5%. However, the average apartment price in Israel in the first quarter of 2017 was NIS 1.432 million, down 3.8% from the first quarter of 2016. A possible explanation is that more homes are being sold in the periphery and this is pulling the average home price down.

Published by Globes [online], Israel business news - www.globes-online.com - on August 15, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Fresh produce Photo: Tamar Matsafi
Fresh produce Photo: Tamar Matsafi
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