The Bank of Israel published updated inflation expectations data showing the latest first-year capital market measure at 1.7%, compared with September’s monthly average of 1.6%. The average forecast from commercial banks and economic consulting companies stood at 2.1%, up from 2.0% in September. One-year expectations derived from banks’ internal interest rates and inflation contracts both remained at 1.9%. Capital market forward expectations stood at 2.1% for both the second and third years, unchanged from September. Expectations for years five to 10 rose to 2.0% from 1.9%, while the five-year measure remained at 1.9%. These capital market measures reflect breakeven inflation and include inflation risk premiums and biases related to taxation and liquidity. The bank noted that the data are being reviewed and that an update will be provided, if necessary, in the coming weeks.
Bank of Israel reports first-year capital market inflation expectations at 1.7%, with data under review
The Bank of Israel’s latest data put first-year capital market inflation expectations at 1.7%, against a September average of 1.6%, while the average forecast from banks and economic consulting companies rose to 2.1% from 2.0%. One-year measures derived from banks’ internal interest rates and inflation contracts were unchanged at 1.9%. The data are under review and may be updated in the coming weeks.