• Israeli stocks, as defined by the BlueStar® Israel Global Index (BIGI®), fell 4.29% in the Q2 2023, underperforming both US and international markets.
  • Israeli technology stocks, as defined by the BlueStar® Israel Global Technology Index (BIGITech®), declined 4.79% in Q2, significantly underperforming US and Global tech peers.
  • The Monetary Committee decided to leave rates unchanged at 4.5% during the May meeting, citing an already elevated risk premium and an expansion in GDP. However, the Bank of Israel mentioned that there has been a modest uptick in inflation, explaining that forecasts for the coming year increased, and are approaching the upper bound of the target range.
  • Despite rising tensions in the North, volatility in Israel’s foreign exchange market has waned as the shekel has been stable around 3.5 USD/ILS.
  • Defense and civilian costs of the Israel-Hamas war has amounted to hundreds of billions of shekels, and the Bank of Israel cited that the future defense budget is expected to grow in a permanent fashion.
  • In the housing market, home prices continued to increase amidst logistical difficulties in the industry’s activities. Although new home purchases are far below 2021 levels, this measure rose slightly quarter-over-quarter, and is now above its 12-month moving average.
  • The budget deficit between 2025 and 2027 is now expected to decline gradually from 5.2% of GDP to 3.7%.

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