Amir Yaron
Amir YaronYonatan Sindel/Flash90

The governor of the Bank of Israel, Prof. Amir Yaron, responds to Moody's decision to downgrade Israel’s credit rating.

"The strength of the Israeli economy and the rapid recovery that it has demonstrated in recent months have also been reflected in the recovery and stability of the financial markets. To be noted that Israel experienced geopolitical crises during periods when debt/GDP ratios were much higher and there was never a delay in the government's debt repayments. In this regard, it is also important to remember the high growth potential of the economy and the structural surplus in its current account," the governor emphasizes.

Yaron points out that "in order to strengthen the confidence of the markets and the rating companies in the Israeli economy, it is important for the government and Knesset to address the economic issues raised in the report. The Bank of Israel has already presented several courses of action in this regard, including the approval of the 2024 budget by the Knesset, with all the adjustments included therein.”

"The Israeli economy is founded on solid and healthy economic foundations, while being a global leader in innovation and technology. We knew how to recover from difficult times in the past and quickly return to prosperity, and the Israeli economy has the strength to ensure that this will be the case this time as well," Yaron concluded.

Last night Finance Minister Bezalel Smotrich attacked the decision and emphasized that "the Israeli economy is strong on all indices. It is capable of supporting all war efforts, on the front line and in the home command, until we achieve victory with God's help and the heroism of its soldiers, and return to an accelerated growth path."

"Hamas-ISIS embarked on the heinous massacre during Simchat Torah (October 7th) with the aim of harming the State of Israel and the Jewish people in their souls and bodies and annihilating them. Since then, they and the entire world have seen a united Israeli heroism, with the ability to endure, and determination to defeat, evil and shine anew on the good, both in Israel and around the world. Hamas will not defeat us, not in terms of security and not financially," said the Minister of Finance.

He attacked Moody's announcement on the downgrade, claiming that “it is not based on serious economic arguments and is entirely a political manifesto relying on a pessimistic and unfounded geopolitical worldview, which reflects a lack of confidence in Israel's security and national strength, and supposedly also includes a lack of confidence in Israel’s just path in face of its enemies. Moody's is not even able to define Hamas and Hezbollah as terrorist organizations in its announcement, implying that it would have avoided the downgrade if Israel had only accepted the suicide plan offered to it by certain people in the international community to stop the war and establish an Arab terrorist state in Gaza and in Judea and Samaria.

"We do not draw our national, security, social and economic strength from the way we are judged around the world, but from a deep belief in our just path, which is based on a glorious past of thousands of years and a commitment to an even more glorious future. Even Moody's announcement will not undermine this, nor will it weaken us in the war for our independence and sovereignty in Israel, our homeland. I thank the Accountant General, the Governor of the Bank of Israel and the other professionals in the Israeli economy for their efforts against the rating company. Together we will win and continue to lead the Israeli economy with responsibility and discretion, and steer it to a safe shore," he concluded.