Israel's central bank decided to maintain its interest rate at 0.1% as inflation continues to languish below the target range of 1 to 3%.
The annual inflation rate in October stood at 0.2%, up 0.1% in the previous month, the Bank of Israel said. The central bank's economists project that inflation will move back to the target range in the fourth quarter of 2018, Reuters said, at which point a 15-basis point increase in the interest rate is likely.
The central bank also is contending with the shekel's continuing appreciation, which has hurt goods exports. In effective exchange terms, the shekel has appreciated by 5.0% in the last 12 months. On a trade-weighted basis, the currency is approaching its strongest level on record, the Financial Times said.
Economic growth accelerated in the third quarter to 4.1% from the revised growth rate of 2.5% in the previous quarter. Private spending was the main growth driver. The labor market is at full employment while a moderate rise in prices points to a cooling of the housing market, the central bank said.
