According to Jinshi, Capital Economics economist Nicholas Farr said that while the Central Bank of Israel maintained interest rates unchanged, it actively communicated with the market, showing its concerns about the escalation of the Middle East war and the consequences of inflation.

Farr pointed out that the resumption of monetary easing in the coming months is unlikely, but the risk of interest rate hikes has increased. The Bank of Israel raised its inflation forecast for the fourth quarter from 3.0% to 3.8%, and even assuming that the conflict will intensify by the end of 2024, the upside risks to the inflation outlook still outweigh concerns about weak economic activity.