State of Israel Bonds are Back
State of Israel Bonds are back. For the first time since March 2009, the Jewish State issued $1 billion in 10-year dollar bonds Monday on the U.S. market.
The capital to be raised from the sale of the bonds will be used to help Israel's government balance the budget, according to the Finance Ministry.
The budget deficit increased by 3.3 percent of Israel's gross domestic product last year, up from a target of 2.9 percent, the ministry told journalist Sara Toth Stub at the Dow Jones Newswires.
Tax revenues are expected to be lower in 2012 as well, and it is likely the state will again miss its deficit target, the ministry said.
Also on Monday, the Bank of Israel announced it was lowering its prime interest rate by a quarter of a percentage point, from 2.75 to 2.5 percent.
The central bank noted that the “slowdown in activity and in demand that started during the second half of 2011 continues,” adding that consumer-price inflation for the year was 2.2 percent, near the midpoint of the target range of 1 to 3 percent.