Israel's Consumer Price Index Rises 0.3% in July Amid Mixed Sector Trends

Israel's Consumer Price Index (CPI) increased by 0.3% in July 2026 compared to June, according to the Central Bureau of Statistics. Over the past 12 months, inflation totaled 1.5%. Significant price rises were recorded in transportation (up 1.4%), culture and entertainment (up 1.1%), and housing (up 0.7%). Conversely, sharp declines occurred in clothing and footwear (down 4.6%), fresh fruits and vegetables (down 3.5%), furniture and home equipment (down 0.7%), and miscellaneous goods (down 0.4%).

The housing rental market saw continued price increases, with lease renewals rising by an average of 2.6% and new rental contracts up 4.7%. In residential construction, input prices fell slightly by 0.1% in July but rose 2.3% since the start of the year and 3.5% annually, mainly due to a 5.4% increase in labor costs. Meanwhile, the industrial output price index for domestic markets dropped 1.2% in July, driven by lower prices for refined petroleum products, base metals, furniture, and chemicals, while prices for textiles, rubber and plastics, metal products, machinery, and computers increased.

Residential apartment prices rose modestly by 0.1% in May-June 2026 compared to the previous two months, with the largest increases in Jerusalem (1.8%), Haifa (1.5%), and the Northern District (0.9%). The Central District and Tel Aviv saw declines of 1.0% and 0.7%, respectively. Despite the monthly rise, apartment prices remain 1.5% lower than a year ago. New apartment prices fell 2.0% year-over-year but increased 0.5% monthly. The average apartment price in Israel in Q2 2026 reached 2.435 million shekels, up 7.9% from 2.256 million shekels in Q2 2025.