The Bank of Israel blamed the sharp decline on a revaluation of Israel’s foreign assets.
Headquarters of the Bank of Israel, the central bank of Israel, in al-Quds, occupied Palestine, on August 23, 2022. (AFP)
According to a report from the Central Bank of Israel, Israel’s foreign exchange reserves decreased by $5.632 billion from March to April, indicating a continued deterioration trend in Israel’s finances.
These reserves now amount to $208.19 billion, but this decrease is mainly due to the revolution in Israel’s external assets, which amounted to $3.895 billion. The government’s purchases and sales of foreign assets totaled a deficit of $1.703 billion.
According to the Israeli news website Globes, the Central Bank of Israel has sold a total of $8.5 billion in foreign currency since “Israel” started the war in the Gaza Strip on October 7, 2023.
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Bank of Israel Governor Amir Yaron said the debt-to-gross domestic product ratio had jumped 1.4 percentage points to 61.9% at the end of last year, and that Israel’s increased military spending was putting the economy at risk. admitted.
“The market’s assessment that Israel is on a path to debt expansion in the medium to long term suggests that further yield increases and This could lead to a devaluation of the currency.” and inflationary pressures. ”
The government has already agreed to increase spending by 10 billion shekels ($2.7 billion) a year from 2025, but some argue it needs to double that amount, stabilizing the ratio at 67% in the future. Goals are set.
The downturn in Israel’s financial system has coincided with a major blow to key economic sectors such as maritime trade, northern agriculture, and tourism, all of which are a direct result of Israel’s genocide of Palestinians in the Gaza Strip. .
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