Consumer Price Index Rises 0.7% in August Driven by Transport and Produce

Israel's Consumer Price Index (CPI) saw a significant monthly increase of 0.7% in August, bringing the annual inflation rate to 1.5% compared to August of the previous year. This monthly jump contrasts with the more moderate annual rise, indicating a recent acceleration in price increases. The surge was largely driven by a 2.9% spike in fresh vegetable prices and a 2.7% increase in transportation costs. Culture and entertainment also rose by 2%, and housing by 0.6%.

However, not all consumer goods became more expensive. Food prices decreased by 0.5%, fresh fruit by 2%, clothing by 0.8%, and furniture and home equipment by 0.3%. This divergence highlights uneven price changes across different sectors of the economy.

For renters, the situation was more pronounced. Those renewing leases experienced a 2.6% rent increase, while new tenants moving into vacant apartments faced a steeper rise of 4.4%. The Central Bureau of Statistics noted that these figures approximate the annual change for each group, and most tenants do not see rent changes mid-contract.

In other economic indicators, the index of industrial output prices for domestic destinations rose by 2.7% in August, largely due to a 28.3% surge in refined petroleum product prices. Excluding fuels, this index increased by only 0.2%. Conversely, industrial export prices fell by 1.2% in the second quarter of 2026. Service sector prices showed mixed trends, with cleaning and accounting services rising significantly, while computer programming and publishing services saw price decreases.