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Israel inflation rate accelerates to 2.7 per cent in March, above consensus

A woman shops at a supermarket in Jerusalem June 19, 2016. REUTERS/Ronen Zvulun/ File photo
A woman shops at a supermarket in Jerusalem June 19, 2016. REUTERS/Ronen Zvulun/ File photo

Israeli inflation accelerated in March, the Central Bureau of Statistics said on Monday, in data that could delay further interest rate reductions.

The annual inflation rate rose by a higher-than-expected 2.7 per cent in March from 2.5 per cent in February. The rate was forecast to edge up to 2.6 per cent, according to a Reuters poll.

The consumer price index (CPI) rose 0.6 per cent in March from February, versus an expected 0.5 per cent, bolstered by higher costs of clothing and footwear, housing, healthcare and transportation.

After cutting its benchmark interest rate in January, the Bank of Israel left the rate unchanged at subsequent meetings in February and April, citing geopolitical tensions, rising price pressures and looser fiscal policy due to Israel’s war with the Palestinian militant group Hamas.

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