The Bank of Israel, led by Governor of the Bank of Israel Prof. Stanley Fischer, has raised the interest rate by 50 basis points, to 3% from 2.5%.
Many economists had expected a more moderate rise of 0.25%.
The bank said that the reason for the hike was relatively high inflation, housing prices that continue to rise, and the growing sense that eventual interest rate hikes in the US will come a bit sooner than previously thought.
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