Central Bank: 2006 growth forecast - 5%

Bank of Israel published last week its latest economic forecast for 2006
 
The central bank raised its economic growth forecast for 2006 from 4.2% to 5%. Leading economists noted following the publication that the forecast was still less optimistic than the forecast published by the Ministry of Finance, which forecast last month a growth rate of 5.3%.
Unemployment is likely to continue to fall gradually, to an average of 8.5% in 2006, and 8.2% in 2007.
 
The bank warned, however, that GDP growth in 2007 is likely to slow down to 4%. The lower 2007 growth rate can be attributed to lower business product, caused partly by manufacturing capacity reaching its maximum level.