Israel’s economic growth slows in Q2 amid Gaza war

Israel’s economic growth slowed in the second quarter of the year, data showed Tuesday, as the country’s ongoing war with Hamas in Gaza continued.

According to the Central Bureau of Statistics, gross domestic product grew 0.3% year-on-year in the April-June period, down from 0.7% growth the previous month and 1.2% in August.

Private consumption, government spending and investment in fixed assets supported the economy, but exports declined.

Last week, the Bank of Israel cut its growth forecast for 2024 to 0.5%, down from a previous 1.5%.

In addition to the economic slowdown, Israel has been hurt by high inflation, and the central bank has warned of a possible interest rate hike.

The central bank left interest rates unchanged for the sixth consecutive time last week.

First-quarter GDP growth remained unchanged at 17.2%, recovering from a sharp contraction in the fourth quarter of 2023 when the conflict in Gaza began.