Israel's growth rate slowed sharply during the third quarter of 2008, the Central Bureau of Statistics reported today. GDP rose by an annualized 2.3% during the third quarter, after rising 4.1% in the second quarter and 5.2% in the first quarter.
Business product growth slowed to an annualized 1.9% in the third quarter from 5% in the second quarter and 5.8% in the first quarter. Industrial output fell by 7.8% in the third quarter.
The Bank of Israel's revised outlook predicts 1.5% GDP growth in 2009; the National Accounts show that Israel's growth has already slumped to this level. The Central Bureau of Statistics data mainly refers to the summer, before the global financial storm worsened last month, causing a rise in risk, a wave of layoffs, and a slump in credit.
The Central Bureau of Statistics reports that, even before the crisis worsened in October, investment in the economy, excluding ships and planes, fell by an annualized 16.5% in the third quarter. The plunge reflects the surge in pessimism by companies. The Central Bureau of Statistics also reports an annualized 13.4% drop in exports caused by the global slowdown and the shekel's appreciation against other currencies during the first half of the year.
Private consumption was the only item that did not fall during the third quarter, thereby preventing a sharper fall in GDP growth. Private consumption rose by an annualized 2.8% during the third quarter, resulting in an annualized 1.2% increase in the standard of living.
Published by Globes [online], Israel business news - www.globes-online.com - on November 24, 2008
© Copyright of Globes Publisher Itonut (1983) Ltd. 2008