Bank of Israel Reports 0.3% Growth in September Composite Economic Index

The Bank of Israel and Governor Prof. Amir Yaron published the composite state-of-the-economy index for September today (Wednesday), showing a 0.3 percent increase in economic activity. The composite index is a key weighted economic indicator designed to diagnose the direction of real economic activity in real time. It provides an estimate of average monthly growth based on weighted data from consumption, employment, trade, and the stock exchange.

Growth Consistent with Long-Term Trends

According to the Bank of Israel, the September index reflects the average monthly growth estimate throughout the third quarter (July through September). The 0.3% rate recorded this month aligns almost precisely with the long-term growth trend of the Israeli economy, indicating relative stability in economic activity.

The central bank noted that the increase in the index was positively influenced by several prominent factors: a surge in credit card purchases in August, growth in goods exports—particularly industrial exports—along with rising stock prices on the Nasdaq 100 and the Tel Aviv Stock Exchange during August and September.

Balancing Factors and Labor Market Dynamics

Conversely, other factors dampened higher growth: employment data, specifically the number of active employees and a decline in job vacancies in August, alongside a drop in indirect tax revenues in September, tempered the overall increase in the index. Additionally, the Bank of Israel downwardly revised previous months' index figures following the arrival of updated and complete data.

The composite index points to an economy that continues to grow at a reasonable and steady pace matching the multi-year average, alongside a recovery in consumption and export sectors, and certain cooling signs in the labor market and tax collection.