عربي English Türkçe اردو فارسى
Logo
Latest News
Business

Israel GDP Growth Revised Down to 0.3% as Gaza War Takes Economic Toll

People take shelter as sirens sound in central Israel in response to what the Israel's military says projectiles fired from Lebanon, in Tel Aviv, Israel October 14, 2024. (Reuters)
People take shelter as sirens sound in central Israel in response to what the Israel's military says projectiles fired from Lebanon, in Tel Aviv, Israel October 14, 2024. (Reuters)
TT
TT

Israel GDP Growth Revised Down to 0.3% as Gaza War Takes Economic Toll

People take shelter as sirens sound in central Israel in response to what the Israel's military says projectiles fired from Lebanon, in Tel Aviv, Israel October 14, 2024. (Reuters)
People take shelter as sirens sound in central Israel in response to what the Israel's military says projectiles fired from Lebanon, in Tel Aviv, Israel October 14, 2024. (Reuters)

Israel's economy grew slower in the second quarter than previously thought, data showed on Tuesday, as Israel's war in Gaza against the Palestinian group Hamas continued to weigh on growth.

Gross domestic product rose by an annualized 0.3 in the April-June period, the Central Bureau of Statistics said in its third estimate, down from 0.7% reported a month ago and from an initial 1.2% published in August.

The economy was supported by gains in consumer and state spending and in investment in fixed assets, while exports fell.

Last week, the Bank of Israel trimmed its Israeli economic growth estimate in 2024 to 0.5% from a prior estimate of 1.5%.

Along with a weakening economy, inflation has spiked and central bank officials have warned of possible interest rate increases. It held rates steady last week for a sixth straight policy meeting.

First-quarter GDP growth was unrevised at 17.2%, as the economy bounced back from a steep contraction in the fourth quarter of 2023 when the war began.

Most Viewed

 
 
Business

IMF Approves Third Review of Sri Lanka's $2.9 Bln Bailout

Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
TT
TT

IMF Approves Third Review of Sri Lanka's $2.9 Bln Bailout

Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage

The International Monetary Fund (IMF) approved the third review of Sri Lanka's $2.9 billion bailout on Saturday but warned that the economy remains vulnerable.
In a statement, the global lender said it would release about $333 million, bringing total funding to around $1.3 billion, to the crisis-hit South Asian nation. It said signs of an economic recovery were emerging, Reuters reported.
In a note of caution, it said "the critical next steps are to complete the commercial debt restructuring, finalize bilateral agreements with official creditors along the lines of the accord with the Official Creditor Committee and implement the terms of the other agreements. This will help restore Sri Lanka's debt sustainability."
Cash-strapped Sri Lanka plunged into its worst financial crisis in more than seven decades in 2022 with a severe dollar shortage sending inflation soaring to 70%, its currency to record lows and its economy contracting by 7.3% during the worst of the fallout and by 2.3% last year.
"Maintaining macroeconomic stability and restoring debt sustainability are key to securing Sri Lanka's prosperity and require persevering with responsible fiscal policy," the IMF said.
The IMF bailout secured in March last year helped stabilize economic conditions. The rupee has risen 11.3% in recent months and inflation disappeared, with prices falling 0.8% last month.
The island nation's economy is expected to grow 4.4% this year, the first increase in three years, according to the World Bank.
However, Sri Lanka still needs to complete a $12.5 billion debt restructuring with bondholders, which President Anura Kumara Dissanayake aims to finalize in December.
Sri Lanka will enter into individual agreements with bilateral creditors including Japan, China and India needed to complete a $10 billion debt restructuring, Dissanayake said.
He won the presidency in September, and his leftist coalition won a record 159 seats in the 225-member parliament in a general election last week.