The IMF previously predicted 4.5% growth. It now
predicts 4.8% growth in 2007, and 4.2% growth in
2008. The IMF's growth forecast for Israel is one
of the highest for developed countries as the IMF
categorizes Israel.
The IMF also predicts 0.1% deflation for Israel
this year; the only developed country for which
it predicts this. The IMF projects that Israeli
inflation will only reach the government's
inflation target midpoint of 2% in 2008. For the
sake of comparisons the IMF average inflation
rate for developed countries in 2007 is 1.8%.
The IMF predicts that Israel's unemployment rate
will fall to 7.5% of the civilian labor force in
2007 and 7.2% in 2008, down from 9% in 2005 and
8.4% in 2006.
Israel's unemployment rate is still among the
highest among developed countries; only Germany,
France, Spain, Belgium, and Greece are projected
to have higher rates.
The IMF has raised its growth outlook for Israel
by 0.3 percentage points in a new World Economic
Outlook report published recently.