money 224 ap.
(photo credit: AP)
Israel’s economy may expand 3.2 percent this year, the International Monetary Fund said in a report on Wednesday, raising its forecast as increased exports help the country recover from recession.
The IMF prediction exceeds its January 25 estimate of Israeli gross domestic product growing 2.5%. The Bank of Israel raised its growth forecast on Wednesday to 3.7% from 3.5%. The economy expanded 0.7% in 2009.
The IMF cited Israel as one of the economies recovering fastest from the global recession, noting the central bank’s increase in borrowing rates. Bank of Israel Governor Stanley Fischer raised the benchmark interest rate on March 28 for the fourth time since August as inflation expectations increased and the economy expanded.
“Because recovery in these economies is likely to be faster than in major advanced economies, they will probably continue to lead the tightening cycle,” the report said.
Consumer-prices will increase 2.3% over the course of 2010, compared
with 3.3% last year, the IMF said. The inflation rate in 2011 will be
2.6%, it said.
The current-account balance will widen to 3.9% of GDP this year from 3.7% in 2009, the IMF said. The forecast for 2011 is 3.7%.
The country’s benchmark TA-25 stock index surged 75% last year, led by
Delek Group Ltd., a partner in a gas find at the Tamar field off
Haifa’s coast last year. The index has gained about 5.3% since the
beginning of the year.