Recent Economic Developments, 107

09/11/2004
All Press Releases In Subject:
The Economy and Economic Activity

Recent Economic Developments, 107

Overview:

In the period from April to September 2004 (the period reviewed) the trend of expansion in economic activity evident since the second half of 2003 continued, although it slowed in 2004:III. The increase in activity was based on a rise in the business sector, mainly in exports, whereas the share of public consumption in GDP declined. Nevertheless, some indicators, such as the composite state-of-the-economy index, suggest a slowdown in the rate of growth in the third quarter or even a real decline, and others, such as the Bank of Israel Companies Survey, point to continued expansion at a rate similar to that in the second quarter. The government stuck to its fiscal policy of reducing expenditure while cutting taxes that is consistent with the achievement of the deficit target. The financial markets were stable, and Israel’s country risk premium remained low.

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