Remarks by the Governor of the Bank of Israel at the Eli Hurvitz Conference on Economics and Society
His remarks dealt with the macroeconomic situation, and focused on the Israeli high-tech sector and a comparison of the structure of Israeli high-tech at the beginning of the century and now. In addition, the Governor related to the developments in inflation in Israel and abroad, and again emphasized that, “Even though the inflation environment in Israel is significantly lower than in other countries, this is a global process. Some of that process is due to supply factors and the continued supply chain interruptions, while some is due to domestic inflationary processes, in respect of which monetary policy is more effective. High inflation impairs economic certainty and activity, and is more damaging to the weaker parts of the population. The Bank of Israel’s Monetary Committee is determined to implement a policy that will bring inflation back to within its target range.”
In addition, the Governor discussed the economic side of yesterday’s political developments, and said: “As I have said many times in the past, the economy loves stability. With that, Israel fortunately has an institutional system that, as we have seen, has made it possible for the economy to function properly during election campaigns. The Israeli economy has proven to have an impressive ability to grow and prosper even under conditions of uncertainty—political and otherwise—and it is, as always, important to continue with responsible fiscal conduct.
I hope that the approval of the State budget will not be delayed much beyond the end of the year. This is the economic task of the highest order for any government, and it is vital for the continued advancement of economic reforms that are essential in accelerating growth and raising the standard of living. The Bank of Israel will continue to conduct independent economic policy that will support price stability alongside economic growth and the encouragement of competition and financial innovation.”