BOL lowers export growth forecast for 2009

The bank decided to lower its export growth forecast in view of the expected recession in Europe and North America, which account for two-thirds of Israel's exports

The Bank of Israel (BoI) lowered its forecasted rate of growth in the manufactured exports sector from 10% in 2008 down to only 4% or 5% in 2009, because of an expected recession in western countries.
 
The Bank reported that profitability of manufactured exports fell markedly in the last two years, mostly because of the deterioration in the terms of trade.
 
The BoI explained that despite the shekel's increased strength against the dollar, trade growth has deteriorated significantly the past two years.
 
The bank warned that slower growth in trade impacts the entire economy, not just the export sector.
 
The BOL clearly noted that in view of the expected recession in Europe and North America, which account for two-thirds of Israel's exports, it decided to lower its export growth forecast.
 
The Bank of Israel also noted it did not rule out another downward revision following the reduction in the growth forecast for the economy as a whole.