{"id":530050,"date":"2026-07-02T21:38:33","date_gmt":"2026-07-02T21:38:33","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/530050\/"},"modified":"2026-07-02T21:38:33","modified_gmt":"2026-07-02T21:38:33","slug":"imf-cuts-israels-economic-growth-estimate-to-3-5-percent-in-2026","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/530050\/","title":{"rendered":"IMF cuts Israel\u2019s economic growth estimate to 3.5 percent in 2026"},"content":{"rendered":"<p>\n\tTEL AVIV: The \u200cInternational Monetary Fund lowered its estimate for Israel\u2019s economic growth in 2026 to 3.5 percent from a prior 4.8 percent, it said on Wednesday citing \u200bregional tensions.<br \/>In a report, the IMF also expects inflation to rise temporarily due to higher energy prices and supply constraints despite shekel appreciation to a more than three-decade peak against the dollar.<br \/>\u201cThe elevated regional tensions are casting a shadow on Israel\u2019s economy,\u201d it said, referring to conflicts with Iran, Hezbollah and Hamas.<br \/>The IMF noted that the economy has shown \u200cresilience despite repeated \u200cshocks, but that elevated regional geopolitical uncertainty \u200band \u200clong-standing \u2060structural \u200bimpediments are expected \u2060to weigh on the outlook.<br \/>\u201cFurthermore, renewed intensification of regional tensions remains a key downside risk,\u201d it said.<br \/>Israel, the IMF said, needs to implement \u201cprudent\u201d policies to safeguard macroeconomic stability and advance structural reforms to boost growth potential.<br \/>After a 2.9 percent growth rate in 2025, the war with Iran in March and April \u2060led the Bank of Israel to trim \u200cits 2026 growth forecast to 3.8 percent, \u200cwhile the Finance Ministry sees growth \u200bof up to 4 percent this \u200cyear.<br \/>Israel\u2019s economy shrank an annualized 3.8 percent in the first quarter.<br \/>The \u200cIMF projects Israel\u2019s economy will grow 4.4 percent in 2027, with an inflation rate holding steady near 2 percent in 2026 and 2027.<br \/>Forecasts, it noted, were based on data up until June 10.<br \/>The \u200cIMF recommended Israel\u2019s government rebuild fiscal buffers for example by raising revenue, along with fiscal consolidation, \u2060due to \u2060higher defense spending to finance the military conflicts.<br \/>The IMF also seeks moderately tight monetary policy since higher energy prices look to push inflation higher.<br \/>In recent weeks, a ceasefire between the United States and Iran has led to a drop in oil prices.<br \/>\u201cThe Bank of Israel should continue to closely monitor war-related effects on labor supply, the pass-through of higher energy prices and exchange rate movements, and the impact of the latest rate cut on financial conditions and domestic \u200bdemand,\u201d it said.<br \/>Policymakers need to \u201cstand \u200bready to adjust course\u201d if incoming data or the heightened risk environment lead to renewed price pressures.<\/p>\n","protected":false},"excerpt":{"rendered":"TEL AVIV: The \u200cInternational Monetary Fund lowered its estimate for Israel\u2019s economic growth in 2026 to 3.5 percent&hellip;\n","protected":false},"author":2,"featured_media":530051,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[72,113,61,60],"class_list":["post-530050","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-ie","tag-ireland"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/530050","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=530050"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/530050\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/530051"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=530050"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=530050"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=530050"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}