The Composite State of the Economy Index for July increased by 0.11 percent

The Composite State of the Economy Index for July increased slightly, by 0.11 percent.  This increase is further to the increase in the second quarter, which showed continued growth in the economy, partly in view of the tight labor market.

The Index was positively affected by increases in Industrial Production index (June), the import of consumer products (July), and employee posts in the private sector (May). The job vacancy rate for July declined slightly, but remained at a high level that reflects the continued desire of employers to expand their operations.  In contrast, the services revenue index (June), the retail trade revenue index (June), the import of manufacturing inputs (July), goods exports (July), services exports (May), electricity production (July), and credit card purchases (July) declined, which had a negative impact on the Index. 

The upward revision of April–June data is, to a large extent, due to the growth of GDP in the second quarter of 2020, which was higher than previously estimated, revisions to GDP growth in previous quarters, and a revision of the retail trade revenue index figure for May.

Table 1 presents the revisions to the Index for previous months.  Table 2 presents the development of components of the Index in the past few months.

Table 1: Revisions in the Composite Index

Revision

Previous figure

New figure

July

 

0.11

June

0.05

0.16

May

-0.10

0.01

April

0.25

0.35

March

0.03

0.03

February

0.13

0.13

 

 Table 2: Changes in the Index components in recent months

(monthly percent change, unless otherwise noted)

 

July

June

May

April

Industrial Production Index

(excluding mining and quarrying)

 

1.1

3.4

0.6

Services Revenue Index

(excluding education and public administration)

 

-2.4

2.3

0.4

Retail Trade Revenue Index

 

-0.7

-0.2

0.7

Imports of consumer goods1

0.2

-0.4

-6.5

14.6

Imports of manufacturing inputs

(excluding fuels)1

-3.8

4.7

1.6

-2.4

Goods exports (excluding agriculture)1

-5.1

-1.8

-7.1

12.3

Services exports (excluding transportation)2

 

 

-2.7

3.5

Number of employee posts in the private sector

 

 

0.9

0.0

Job vacancy rate in the business sector3

4.9

4.9

4.9

5.1

Building starts4

 

 

 

 

Electricity production5

-0.9

3.3

0.5

-7.1

Credit card purchases6

-2.0

3.5

1.8

0.7

 

1 Goods imports and exports are calculated in fixed prices (adjusted for changes in foreign trade price indices).

2 Services exports are calculated in real terms using the Consumer Price Index, and are comprised of the export of other business services and the export of tourism services.

3 The job vacancy rate is calculated out of the total number of employed people, and is included in the index at its seasonally adjusted level.

4 Since the Central Bureau of Statistics publishes data on building starts once per quarter, the data integrated into the model are at a monthly frequency based on additional sources, such that the distribution is consistent with the quarterly data published by the Central Bureau of Statistics (in percent, seasonally adjusted).

5 Electricity production is calculated as the rate of change relative to the previous month, adjusted for the effect of the weather and seasonality on daily, weekly, and annual bases.

6 The credit card purchases figures is the monthly seasonally adjusted change according to Central Bureau of Statistics publications.  When the CBS figure for a month is not available, the figure listed is the monthly rate of change according to daily data from SHVA, seasonally adjusted on weekly and monthly bases.


Detailed explanations regarding how the Composite Index is calculated, as well as detailed long-term tables, can be found at

https://www.boi.org.il/en/Research/Pages/ind.aspx

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