With housing costs and inflation on the riseAccording to data released on Tuesday, and yet another national election is scheduled for November 1, Israel is less confident about economic growth.
A consumer survey for June by the Central Bureau of Statistics (CBS) has shown That overall consumer confidence fell seven points in June compared to May.
The survey provides monthly information for a range of indicators and is conducted with a representative sample of participants over the age of 21. Some 8,800 participants were asked for their general assessment of economic status, their expectations for a change in situation, and plans for large purchases and savings in the near future. These assessments are made for three time periods: the previous year, the present and the coming year.
The index is graded on a scale of plus 100 to minus 100, with zero marking the mid-point where people would define themselves as neither optimistic nor pessimistic. The closer a figure is to 100, the more they feel a surge in confidence; The closer a figure is to minus 100, the less confident they feel.
The recent survey showed that consumer confidence fell from -14 points in May to -21 points in June.
When asked about their confidence in the overall economic situation and outlook for Israel in the coming year, the index fell to -34 points, rose to -24 in May, potentially due to political turmoil combined with rising prices. response of.
When asked about expected changes in the economic situation in their own household in the coming year, respondents replied with -1 in June, down from 5 a month earlier.
Construction site in the central Israeli city of Beer Yaakov, 2022 (Yosi Aloni/Flash 90)
When asked about the changes already in their home economic situation over the past year, the index has since the beginning of the year reversed its continuous upward trend and fell to minus -21 – a sign that People consider themselves very bad now. compared to a year ago.
Perhaps surprisingly, when asked about their intentions to make bigger purchases (houses, cars, etc.) in the next year than their plans for the previous year, confidence went up by -26 points (from -21 in May). had fallen. There are some signs of a slow housing marketwhich may be related.
Overall, the Relative Consumer Confidence Index fell to -31 points. a high negative figure It suggests that people will rein in their spending because they do not feel optimistic enough about the future.
The index uses standard OECD guidelines, and despite the mentioned decline, overall confidence in Israel remained ahead of Spain, Portugal, Italy, the United Kingdom and the most pessimistic country, Japan.
The Consumer Confidence Index showed volatility throughout the COVID-19 pandemic, falling as restrictions were enforced and rising as vaccination campaigns took effect.
During the first general lockdown, the index fell to -31, and reached -28 during the second shutdown.
But from November 2020 to July 2021, consumer confidence continued to grow. The index hit -1 in August 2021, rising further as the country remained free of restrictions during Jewish holidays and no further lockdowns were imposed.
In general, a lack of confidence and an intention to postpone large purchases reflects overall concerns about household spending, and more specifically. accommodation costs Which is growing faster than inflation. majority of Recent figures put inflation at 4.1%, with a prediction that it will increase further in this calendar year. This in turn has led to higher interest rates – up to 1.25% – which has an almost immediate effect on disposable income for households on a variable mortgage rate.
The Bank of Israel has stated that the Israeli economy is in relatively good size, But the global recession has stunned investors and hit fundraising and growth for tech firms around the world.
At Home, an Israeli Endo housing protest movement The demand for government action on the overall cost of living, along with rental and purchase prices for housing, is gaining steam.
