March CPI rises 0.5%

Pasted by Brian Redhead

The Consumer Price Index (CPI) rose by 0.5% in March compared to February, the Central Bureau of Statistics (CBS) said Tuesday, following four months of price reductions in light of the recession.

Analysts were surprised by this figure in light of pre-estimations pointing to a stable CPI or a price-hike of up to 0.2%. Since the beginning of the year, the CPI has fallen by 0.1% on the backdrop of rise in unemployment, the cutting down of production and the drop in demands.

Price-hikes were mainly recorded in the following categories: Fruit and vegetables (3.6%), housing (1.6%), transportation (1.6%) and food (0.4%). The clothing and footwear category, on the other hand, saw a price reduction of 3.9%

The inflation rate in the past 12 months (March of 2009 compared to March of 2008) totaled 3.6%, surpassing the Bank of Israel's inflation target of 1-3%.



According to the Bank of Israel's publications in March, the capital market estimates that the inflation in the next 12 months will stand at 0.6%, with banks and investment houses estimating that the price-hike over this period will total 0.7%. Click here to read more.