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Israel's Economy Recovers Faster Than Expected, Driven by Government Spending
Israel's economy grew by 15.4% in the second quarter of 2026, a revised upward estimate by the Central Bureau of Statistics. The first quarter contraction was also less severe than expected, shrinking by only 1.5%.
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What happened
- 01Israel's economy grew 15.4% in Q2 2026, revised upward by the Central Bureau of Statistics.
- 02The Q1 2026 economic contraction was less severe than expected, at 1.5%.
- 03Increased government and defense spending drove the Q2 economic recovery.
- 04Exports, excluding startups and diamonds, were revised down to 17.7%.
- 05Private consumption rose 14.6% in Q2 2026.
- 06Domestic investment trends remain weaker than initially projected.
This recovery is largely driven by increased government and defense spending, compensating for weaker export figures. While private consumption saw a 14.6% increase, domestic investment trends remain weaker than initially projected.
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