Inflation slows in July from the prior month

Latest reading: Consumer prices rose 1.5% on a year-on-year basis in July, following a 1.6% increase in the previous month. July's reading was the weakest since May 2021, below market expectations and comfortably within the Bank of Israel’s 1.0–3.0% target range. A strong shekel has been depressing price pressures recently. Relative to the previous month's data, there were reduced price pressures for transportation and communication (-0.4% on a year-on-year basis vs -0.3% in June), education, culture and entertainment (+1.3% vs +1.4% in June) and clothing and footwear (-6.3% vs -5.9% in June). Finally, the variation in food prices was the same as in the prior month (+1.5% in July and June). Meanwhile, core consumer prices increased 1.4% in annual terms in July, following a 1.6% rise in the prior month. Lastly, consumer prices rose 0.29% in July on a month-on-month basis, following a flat reading in the previous month.

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