Israel's Inflation Drops to 1.6% in June with Housing Prices Falling

Israel's consumer price index (CPI) for June 2025 remained unchanged compared to the previous month. However, since the CPI rose by only 0.3% in June 2024, the annual inflation rate significantly decreased to 1.6%, marking the lowest inflation level since 2021. Despite this decline, the Bank of Israel is not expected to lower interest rates in the near future.

Housing prices saw a notable drop of 1% in June. Price increases were recorded in several sectors: culture and entertainment rose by 1.0%, housing costs increased by 0.7%, health expenses went up by 0.6%, and food prices grew by 0.4%. Conversely, significant price decreases occurred in fresh vegetables and fruits, which fell by 5.2%, clothing and footwear dropped by 2.7%, transportation costs declined by 0.7%, and furniture and home equipment prices decreased by 0.5%.