Overview
- The quarter-point reduction brings the benchmark rate to 4.25%, aligning Israel with a broader shift toward global monetary easing.
- Official data showed October inflation at 2.5%, squarely within the Bank of Israel’s 1–3% target range after wartime supply pressures receded.
- Governor Amir Yaron told Reuters that uncertainty remains high and said two additional 25-basis-point cuts by September 2026 are a reasonable pace.
- The bank last cut rates in January 2024, then held a cautious stance through the two-year conflict as price pressures persisted.
- Analysts had widely expected the decision, which is projected to ease burdens on mortgage holders and other variable-rate borrowers.