The Bank of Israel kept its benchmark interest rate unchanged for December amid signs that economic growth is rebounding from a slowdown earlier this year.
The central bank reiterated that monetary policy will remain accommodative for a considerable time even while noting expectations have firmed that the U.S.
Federal Reserves will raise borrowing costs next month. The monetary policy panel, led by Governor Karnit Flug, kept the rate at 0.1 percent on Monday. The decision to keep the interest rate for December 2015 unchanged is consistent with the Bank of Israel's monetary policy, which is intended to return the inflation rate to within the price stability target of 1–3% a year, and to support growth while maintaining financial stability.
In view of developments in the inflation environment, in growth in Israel and in the global economy, in the exchange rate, as well as in monetary policies of major central banks.
The Bank of Israel’s ‘S’ index of economic indicators on Sunday also showed the economic recovery continuing into the fourth quarter. The index rose to 0.29% in October from 0.13% the previous month, primarily due to higher imports of consumer goods and manufacturing inputs.