18.10.2010 Uncategorized No Comments

CPI up 0.3%, so will Interest rates rise again?

After the interest rate hike last month, eyes were closely on the latest inflation figures to see whether or not they would rise again.
The inflation figures were up 0.3% for the month of September. This was not a real surprise, but the surprise for me (after being in this industry for 8 years) was that 0.2% of the rise was due to tomatoes and cucumbers!
Yes, due to the extreme weather we have experienced this summer the prices of these vegetables have shot up.
As a result, it is very unlikely the Bank of Israel will raise interest rates again this month. The only reason they would raise interest rates would be to try and curb the rise in house prices. However, having witnessed the effect it had on the exchange rates last month, they are unlikely to do so again this month.

So for any of you with tracker mortgages, you should be safe for another month!

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