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HomeEconomyIsraeli Economy Grows by Only 1% in Q2 of 2019

Israeli Economy Grows by Only 1% in Q2 of 2019

Part of the reason was the import of cars in March to avoid increase in customs

The Central Bureau of Statistics (CBS) released initial figures for economic growth during the second quarter of 2019. CBS showed a growth rate of only 1% during Q2, a marked decrease from 4.7% rise seen in Q1. The number is a little misleading. Economic growth reported in the first quarter was inflated by the pre-importing of cars in March, set to arrive in the country before the import taxes on several brands were scheduled to rise. 

Despite this fact, the 1% growth figure should be of some concern. During Q1, exports rose by 8.3%, but only by 4.6% in Q2. Imports grew by 5.7% in the first quarter and only 2% in the second quarter. Consumer spending, which had increased by 3.8% in the first quarter, became negative, with a drop of 3% in the second quarter. The importation of cars which had grown 68% in the first quarter, dropped by 53% in the second. While the economy continues to grow, these precipitous drops, despite the partial explanation, due to the impact of the decline in car imports should be a concern.

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