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Wall Street Black Week: The US Stock Exchange Dived Israel today

2022-06-11T12:55:39.042Z


Trading closed on Friday with sharp declines against the backdrop of higher-than-expected inflation data in the US • Technology stocks led the declines • Inflation in Israel remained moderate relative to other developed countries - 4% per year


The worst week since January: Wall Street trading closed sharply lower on Friday amid higher-than-expected U.S. inflation data. The U.S. consumer price index jumped 1 percent in May to 8.6 percent in the past 12 months while economists Forecast of a more moderate increase, of 8.3%, the sharpest annual jump in inflation in 41 years.

The rise in the US index was affected by the jump in prices of three main components - housing, food and fuel.

The publication of the data has raised investors' expectations that the US Federal Reserve will raise interest rates at a higher rate than expected. Government bond yields jumped sharply last night - the 10-year yield jumped 0.11% to 3.16%.

The S&P index fell 2.9%, the Dow Jones industrial average fell 2.7%, and the NASDAQ index fell 3.6%. And the share of Anvidia lost a dip close to 6%.

And what about Israel?

In Israel, too, inflation has sharpened in recent months, but has remained relatively moderate compared to other developed countries - 4% in the past year compared with 8.6 in the US, for example.

This coming Wednesday, the Central Bureau of Statistics will publish the May Consumer Price Index.

According to analysts' forecasts, a further rise in the price index of 0.8% -0.7% is expected - which will lead the rise of the index, looking at the last 12 months, to a level between 4.3% and 4.4%, which will be a record of more than 11 years.

To moderate the level of inflation in the economy at the end of May, the Bank of Israel raised the interest rate in the economy by 0.4% to 0.75%.

This is the highest interest rate level since 2014, and the first time since 2011 that the interest rate has been rising for two months in a row.

The Bank of Israel's next announcement on the level of interest rates in the economy will be on July 4, and in the interest rate market, estimates have risen that the interest rate will rise by a sharp rate - 0.5%.

However, some analysts believe that the interest rate will rise at a more moderate rate - by 0.25%.

The rate of increase depends largely on the inflation data in the economy, which will be published as stated this coming Wednesday.

The Bank of Israel hopes that inflation will return to the target range (1-3%) towards the end of the first quarter.

The Governor of the Bank of Israel, Professor Amir Yaron, said in an interview with Israel Today that "the research division's forecast, of an average of 1.5% for the first quarter of 2023, is still the right environment. However, we are in a world of enormous uncertainty. Hungarian cube, it has more than six sides at the moment.We are looking at what is happening in China and Ukraine - these are two situations that on the one hand cause continued disruptions in supply chains and inflationary pressures, but also act to slow down economic activity. Very great certainty. "

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Source: israelhayom

All news articles on 2022-06-11

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