BoI leaves interest rate at 3.25%

Central bank says decision consistent with process of returning the interest rate to a more normal range intended to position inflation firmly within the target range.

By NADAV SHEMER
June 27, 2011 23:03
1 minute read.
The Jerusalem Post

Stanley Fischer 311. (photo credit: Bloomberg)

 
X

Dear Reader,
As you can imagine, more people are reading The Jerusalem Post than ever before. Nevertheless, traditional business models are no longer sustainable and high-quality publications, like ours, are being forced to look for new ways to keep going. Unlike many other news organizations, we have not put up a paywall. We want to keep our journalism open and accessible and be able to keep providing you with news and analyses from the frontlines of Israel, the Middle East and the Jewish World.

As one of our loyal readers, we ask you to be our partner.

For $5 a month you will receive access to the following:

  • A user experience almost completely free of ads
  • Access to our Premium Section
  • Content from the award-winning Jerusalem Report and our monthly magazine to learn Hebrew - Ivrit
  • A brand new ePaper featuring the daily newspaper as it appears in print in Israel

Help us grow and continue telling Israel’s story to the world.

Thank you,

Ronit Hasin-Hochman, CEO, Jerusalem Post Group
Yaakov Katz, Editor-in-Chief

UPGRADE YOUR JPOST EXPERIENCE FOR 5$ PER MONTH Show me later Don't show it again

Bank of Israel Governor Stanley Fischer decided on Monday to keep the benchmark interest rate at 3.25 percent in July, as predicted by most analysts in the days leading up the decision.

In announcing its decision, the central bank said that it was consistent with the process of returning the interest rate to a more normal range intended to position inflation firmly within the target range, and to support further growth, while maintaining stability.

Be the first to know - Join our Facebook page.


“At the current level of the interest rate, monetary policy continues to be expansionary,” it said.

It said that the annualized rate of inflation continues to be high, at 4.1%, as is the annualized increase in house prices, at 15.3%. But it noted that inflation expectations derived from the capital market declined over the past month, and that housing prices are expected to be affected over the coming year by the effect of recent rate increases and by recent measures taken by the bank and the Finance Ministry in the mortgage market and real estate taxation.

The bank also noted that interest rates in the major advanced economies are still lower than in Israel, and “are expected to remain so in the next few months.”

“Against the background of the acceleration in inflation in fast growing economies, several central banks increased their interest rates again this month.

However, the concern of a slowdown in US growth and the worsening of debt risks in Europe led to expectations of a slowdown in the pace of interest rate increases in other markets,” it said.



The minutes of the discussions prior to this interest rate decision will be published on July 11.

Related Content

The Teva Pharmaceutical Industries
April 30, 2015
Teva doubles down on Mylan, despite rejection

By GLOBES, NIV ELIS