Wednesday, September 28, 2016

The Melnick State of the Economy Index increased by 0.1 percent in August

Business sector growth continues at a moderate rate
Private consumption growth leads GDP growth
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The Melnick State of the Israeli Economy Index increased by 0.1 percent in August 2016. Growth in the business sector continues at a moderate rate.  The high level of revenue in commerce and services, reflecting mainly domestic demand and private consumption, continues illustrating to the contribution of private consumption to economic growth.  As is known, private consumption has been leading economic growth in recent years. The industrial production index, which reflects the supply side of the business sector, is unable to break the deadlock of the situation it is in.  Apparently this situation will continue as long as the global economic condition does not improve from the prolonged financial crisis. The imports index, which consists mainly of import of inputs for domestic production but also consumer goods, is fluctuating around a given level without a clear trend up or down. The number of employee posts in the business sector is consistent with the moderate growth of the economy, there is no evidence of weakness in the labor market.


The August Index components include: a decrease of 2.9% in the index of industrial production in July, after rising 2.7% in June; A decrease of 0.9% revenue in commerce and services in July, after rising 1.9% in June; A decrease of 2.9% in the Imports Index in August, after rising 1.5% in July, and an increase of 0.4% in the number of employee posts in the business sector in June, after declining 0.6% in May.
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