Israeli Finance Minister opposed rate hike by central bank
2023.02.20 15:09
Israeli Finance Minister opposed rate hike by central bank
By Tiffany Smith
Budrigannews.com – The foreign minister of Israel voiced his displeasure with the Bank of Israel for raising its benchmark interest rate once more on Monday and stated that he was in favor of a procedure that would put an end to any further rate increases.
On Twitter, Foreign Minister Eli Cohen wrote, “There was no justification for today’s interest rate hike in the context of moderating inflation.”
In response, Governor Amir Yaron of the Bank of Israel suggested that Cohen examine the most recent data, which indicate that inflation is continuing to rise, while respecting the independence of the central bank.
In January, Israel’s inflation rate reached a new 14-year high of 5.4%, prompting the central bank to raise interest rates for the eighth time since April to 4.25 percent at a policy meeting on Monday.
Cohen wrote that he had asked Israel’s finance minister to work with Yaron to “formulate an outline” so that interest rates wouldn’t rise any more.
Later, Yaron stated: Naturally, as foreign minister, it is desirable that he comprehends the significance of the central bank’s independence. We are aware of the final outcome in every nation in which the central bank was harmed.”
Andrew Abir, Deputy Governor of the Bank of Israel, stated that additional interest rate increases were likely to combat “sticky” inflation and demonstrate the bank’s determination to return the inflation rate to a range of 1-3%.
