Professor Amir Yaron told Bloomberg that a fourth closure would shave 0.5% of Israel’s GDP growth in 2021.
As the rate of infection in Israel rises sharply, 6,363 new cases of coronavirus infection were reported yesterday, the highest number since February, the governor of the Bank of Israel Pro said. Amir Yaron warned of a fourth closure. He told Bloomberg today that everything should be done to avoid re-closure and that this would bring down 0.5% of GDP growth in Israel in 2027. The latest forecast of the Bank of Israel was a 5.5% growth in Israel in 2021.
Yaron’s comments align the Bank of Israel with the Ministry of Finance. Yesterday, Finance Minister Avigdor Liberman stressed that everything must be done to avoid closure. The scale of the danger posed by the current Delta wave was unclear, Lieberman said, but there was a consensus on the economic damage that quarantine could cause.
The government’s main concern is that talking about locking will convince many people to cut spending and save their money for a ‘rainy day’. There are already indications of a slowdown in demand with a sharp drop in credit card expenditure on education and leisure, and data on consumer confidence from the Central Bureau of Statistics are also falling.
Posted by Globes, Israeli Business News – en.globes.co.il – August 10, 2021
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Amir Yaron Photo: Bank of Israel spokesperson