The Monetary Committee of the Bank of Israel has decided to keep the interest the bank charges commercial institutions at a tenth of a percent for the month of February. Among the considerations the Bank noted in announcing the decision was that the consumer price index for December was unchanged, in line with expectations. The inflation rate was negative in 2016, but is on an upward trend.
Short-term inflation expectations are below the target, while longer term expectations derived from the capital market remain anchored near the midpoint of the target range. A statement by the bank said, "The Monetary Committee is of the opinion that the risks to achieving the inflation target remain high, yet the increases in wages and in global inflation are expected to support the return of inflation to the target."