Bank of Israel: Inflation to surpass target rate, interest rate to rise

Bank of Israel has estimated that the inflation over the coming 21 months will reach 3.2%, surpassing the government's target inflation rate of 1%-3%. As per the estimation, the inflation will reach the target range only in the second half of 2012.

The bank's economists expect the market to continue to grow at the rates of 4% and 4.5% in 2011 and 2012, respectively. In light of these estimations, the interest is expected to be gradually raised to 4.4% within a year. (Avital Lahav)