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Rent prices up 4.3% in 2011
Photo: Herzl Yosef
Vegetable prices down 11%
Photo: Shutterstock

Housing prices up 5% in 2011

Central Bureau of Statistics figures for past year reveal price hikes in electricity (13%), rent (4.3%) and petrol (7.3%); reductions recorded in prices of fresh fruit (14.4%), vegetables (11%) and communication (7.7%). Inflation rate totals 2.2%

Israel's inflation rate totaled 2.2% in 2011, meeting the annual target range set by the government (1-3%), the Central Bureau of Statistics reported Sunday.

 

The previous year recorded an inflation rate of 2.7%, down from 3.9% in 2009.

 

The consumer price index (CPI) for December remained unchanged, as opposed to early capital market estimates which expected a 0.2% increase.

 

Hikes were mainly recorded in December in the prices of vegetables (5.7%) and rent (0.3%). Reductions were recorded in the prices of fresh fruit (2.8%) and transportation and communications (0.4%).

 

A summary of 2011 reveals major price hikes in the following consumption clauses: Electricity for private consumption (13%), housing (5.1%), rent (4.3%), petrol (7.3%), oil and diesel fuel for heating (24.5%), margarine (19%), butter (17%), health insurance services (7.7%) and meals at work (15.2%).

 

The overall CPI increase in 2011 was partially compensated by price reductions in other consumption clauses, including: White cheese (14.6%), fresh fruit (14.4%), fresh vegetables (11%), communication (7.7%), poultry (5.4%), computers (13.3%), sounds systems (19.1%), Internet services (20.2%) and cars (3.3%).

 

The CBS figures also reveal that the CPI for the two lower echelons increased by 2.1% in the past year, while the CPI for the two top echelons was up 2.3%.

 

The most intriguing clause in the consumer price index – housing – fell 0.1% in December despite rising 5.1% throughout 2011 and contributing 1.25% to the rise recorded in the general index. In 2010, the housing clause recorded a 4.9% increase and a 1.1% contribution to the general index.

 

The rise recorded in the housing clause in 2011 is slightly lower than the 6.9% increase over the past year (October-November 2011 compared to October-November 2010) in actual apartment prices, which are not included in the CPI.

 

Estimate: Interest rate to be reduced

Capital market analysts estimated Sunday evening that the fact that the actual inflation rate for the past 12 months and the expected inflation rate for the coming year are within the government's target range would allow the Bank of Israel's Monetary Committee to begin reducing the interest rate at the end of the month.

 

The Monetary Committee members indicated the direction they were taken as early as two months ago, when they decided to lower the interest rate, signaling a temporary shift from the war on inflation in favor of a desire to support economic activity.

 

For this reason, estimates are that at the end of the month the Monetary Committee will decide to lower February's interest rate by a further 0.25%, bringing it to a level of 2.5%.

 

 


פרסום ראשון: 01.16.12, 09:21
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