Economy expands at slower pace

By SHARON WROBEL
December 23, 2010 22:24

Unemployment rate rises for first time in three months, to 6.6%.

2 minute read.



The Bank of Israel.

The Bank of Israel.. (photo credit: Ariel Jerozolimksi)

The Bank of Israel’s state-of-the-economy index rose 0.1 percent in November, as leading economic indicators pointed to continued growth but at a slower pace than in the first half of the year.

“The October index data, like those for previous months since July, show that the pace of activity is more moderate than in the first half of the year,” the central bank said Thursday in its report.

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“The mild upturn in November reflects increases in manufacturing production, trade-and-services revenue and exports of goods, which were offset by decreases in imports of consumer goods and production inputs and services exports.”

The manufacturing production component of the index rose 5.4% in October, after declining 3.2% in September. The trade-and-services revenue component of the index rose 1.3% in October, after falling 0.7% in September.

The exports of services component of the index fell 3% in November, after increasing 2.5% in October. The exports of goods component of the index rose 0.9% in November, after advancing 0.6% in October.

The imports of consumer goods dropped 6.2% in November, after rising 15.2% in October. The imports of production inputs fell 0.8% in November, after rising 2% in October.

The Central Bureau of Statistics reported Thursday that the unemployment rate had risen to 6.6% of the civilian labor force in October, from 6.5% in September, returning to its level in March. Preliminary figures showed that the unemployment rate in October increased for the first time in three months, during which it remained steady at 6.5%.

Since the economy started to recover from the global financial crisis over the past year and a half, unemployment declined gradually from a peak of 7.7% in May last year to 6.4% this May.

In a separate report Thursday, the statistics bureau said industrial production had dropped an annualized 8.5% in the August-October period, after growing 0.6% in the previous three months. The fall was mainly led by a drop of 17.4% in hi-tech production. Manufacturing production, excluding hi-tech, declined an annualized 1.1%, after growing 2.6% in the previous three months.

From the beginning of the year to October, industrial production in seasonally adjusted terms grew 9% compared with the same period last year and by 8.9% not including the hi-tech sector.

“Trend figures show that the continued growth in industrial production recorded from June last year came to a halt in June this year, and in the past four months since July, a monthly downward trend in the figures is recorded,” the statistics bureau said in its report. “The downward trend is led mainly by declines in the hitech sector.”

Against this, production in the mixedtraditional industry sector grew 4.5% in the August-October period, after growing 5% in the previous three months.

From the beginning of the year to October, the sector grew 15.5%.


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