The Bank of Israel's Monetary program for October 1999

September 27,1999
Monetary program for October 1999

The Bank of Israel announced its monetary program for October 1999, according to which the Bank’s interest rate remains unchanged.

The Bank of Israel pointed out that the development and the nature of the current risks regarding inflation must be continuously and closely examined; this derives from the commitment to act to achieve the inflation target of 3-4 percent per year set by the government for the next two years. These risks are reflected, inter alia, in various assessments of inflation for the next year and beyond, and in the long-term rate of increase of the money supply, which is still higher than it should be.

The Bank of Israel also emphasized that exceptional developments in the foreign-currency market must not be allowed to cause a deviation from the inflation targets decided upon. It is therefore essential that a comprehensive budget and interest policy be operated, consistent with the long-term framework for the government’s deficit and inflation targets.

This policy of maintaining economic stability is fundamental to the attainment of sustained growth.