Wednesday, December 28, 2011

Israel economic growth forecast 2012

World Economic outlook - Israel economic growth forecast 2012 : The Bank of Israel has revised downwards its growth forecast for the Israeli economy in 2012. The forecast growth rate for GDP is now 2.8%, compared with a previous forecast published in September of 3.2%. The Bank of Israel estimates growth in 2011 at 4.8%.

In its statement, the central bank said, "The expected slowdown in the rate of GDP growth in 2012, relative to that of 2011… is primarily due to the deterioration in global conditions, specifically the debt crises in Europe and their effects."
After the Central Bureau of Statistics reported today that Israel's unemployment rate fell to a record low of 5% in October, the Bank of Israel warns that the low rate will not last. "The unemployment rate is expected to increase from 5.6% in the third quarter of 2011 to 6.4% in the fourth quarter of 2012, with a moderate increase in the rate of participation in the workforce, to 57.6%," the bank states.

The central bank sees the growth in Israel's exports slowing to 1.2% next year, and has revised downwards its estimate for export growth in 2011 to 2.1%, compared with 3.9% in the September forecast. The bank says that the update "is due to the sharp decline in exports in the third quarter of 2011, according to National Accounts data published in November."

The growth in imports is also expected to fall drastically. "The slowdown in the rate of growth of demand in 2012, compared to 2011, is expected to be reflected as well in a marked slowdown of imports, which are expected to increase by only 1.4% in 2012, compared with 8.8% in 2011," the central banks states.

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