The consumer price index rose by 0.6% in March, the CBS announced today. This is below the expectations expected of 0.8%. Thus, the inflation rate in the last 12 months amounted to 3.5%, similar to February data, and above the Bank of Israel’s target range. Third month in a row.
In light of the sharp jump in commodity prices, the Bank of Israel updated its inflation forecast sharply to 2.35% earlier this week, while raising the interest rate to 0.35%. The Bank of Israel expects that the inflation rate is expected to amount to 3.6% at the end of the year, a slightly higher level than is currently the case with the publication of March data. Beyond that, the Bank expects a convergence of inflation to the target center – 2% – during 2023.
Significant price increases were recorded in the clothing and footwear sectors (which increased by 4.6%), culture and entertainment (which increased by 2.1%) and transportation (which increased by 1.6%). A significant decrease in prices was recorded in the fresh vegetables and fruits sections (which decreased by 2.5%).
The price index of residential construction inputs rose by 1% in March, thus completing an increase of 2.3% since the beginning of the year, and in the last 12 months (March 2022 compared to March 2021) the price index of residential construction inputs rose by 6.6%.
A 15.2% increase in housing prices per year
Comparing the prices of transactions made in January 2022 – February 2022 compared to the prices of transactions made in December 2021 – January 2022, it was found that apartment prices increased by 1.8%, thus completing an increase of 15.2% compared to the same period last year (January 2021 – February 2021).
In the segmentation of changes in housing prices by district in January 2022 – February 2022 compared with December 2021 – January 2022, price increases were recorded in all districts: Central (2.4%), Jerusalem (2.2%), Haifa (2.1%), North (1.6%), South (1.5%) and Tel Aviv (1.3%).
In the segmentation of changes in housing prices by district compared with the corresponding period last year, January 2022 – February 2022 compared with January 2021 – February 2021, double-digit price increases were recorded in all districts: Central (17.7%), Jerusalem (16.4%), Tel Aviv (14.5%), Haifa (13.2%), South (12.0%) and North (11.5%).
In the price index of new dwellings, it was found that their prices increased by 5.1% in January 2022 – February 2022 compared with December 2021 – January 2022, thus completing an increase of 17.8% compared with the corresponding period last year (January 2021 – February 2021). The percentage of transactions carried out with government support and participated in the calculation is 13.1%, compared with 20.5% in the previous period (December 2021 – January 2022).