The Bank of Israel on Sunday raised its benchmark interest rate by 25 basis points to 1.50%, taking most analysts by surprise who had predicted no change.
This is the fourth time since August last year the benchmark interest rate has been raised.
"The current increase is made against the background of growth that continues to become more firmly based, inflation expectations that are close to the upper limit of the target inflation range, and the rise in asset prices," the bank said in a statement.
"However, monetary policy continues to be expansionary even after this increase."
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.