CBS: April inflation hits five-year high

The global rise in oil and food prices are the main factors for the recent months' high inflation. April inflation was 1.5%, the highest rate for the month since 2002
 
The Central Bureau of Statistics said last week that Israeli inflation accelerated more than expected to an annual 4.7% in April, the fastest pace in five years and exceeding the government's target range for a fifth consecutive month. The April consumer price index rose far more than expected. April inflation was 1.5%, the highest rate for the month since 2002, when it also rose 1.5%.
 
The increase was mostly due to significantly higher prices in April, with the biggest coming in clothing and shoes, which became 6.7% more expensive. Food, including fruits and vegetables, was up 2.3%; transportation and communications cost 2% more; education, culture and entertainment cost 1.5% more; and housing was up 1.1%. Seven out of the 10 major subcategories were significantly higher.
 
Price changes listed for specific items included: tomatoes - an increase of 94.3%, domestic and foreign recreation a rise of 10.6%; fresh fruit rose by 11.1%; prices of bread and cereals rose 2.6%; the price of meat, poultry, and fish rose by 1.9%; milk and dairy products rose 1.6%; and fuel and oil rose 1.6%. The price of cucumbers fell by 35%.
 
The global rise in oil and food prices are the main factors for the recent months' high inflation. Continued increases in world oil prices threaten to keep inflation cruising at a high pace, and make it extremely unlikely that the government will hit its 2008 target.
 
The announcement made by the CBS put many economists on the alert some arguing that the Israeli economy is rapidlymoving into an inflationary period.
 
Analysis made by local economists point at the fact that the inflation is partly imported, but also partly locally influenced. Prices for Israeli made goods, manufactured or grown, are rising, and have been doing so for almost a year. But on top of this is the increased price of imported goods, and not only food and energy products.