Bank Hapoalim’s and TNS Teleseker’s Israeli Consumer Confidence Index, rose by 5.1 points in June to a level of 118.9 (April 2002=100).
The Present Situation Index gained 7.3 points while the Expectations Index was down by 3.8 points.
Bank Hapoalim economists noted that the rise in the Consumer Confidence Index for June followed a particularly large decrease in May. As a result of the adjustment in the index, it gained half of what it had lost in the previous month.
Bank Hapoalim economists also noted "We believe that the sharp drop in consumer confidence in May derived from its proximity to the publication of the new austerity measures, including tax hikes, in the State Budget that was presented to the Knesset.
While indicators of private consumption published by the Central Bureau of Statistics, such as the revenues of the principal industries and credit card sales were actually positive, this may have included the effect of purchases that were brought forward before the VAT hike in June.
Exclusive of the effect of natural gas, we do not expect growth in the economy to exceed 2.5% in the second half of the year. In the USA, the Conference Board Consumer Confidence Index rose by 7.1 points in June. This was the third consecutive month when the index there rose.
The level of the index in the USA is the highest since January 2008, and this is in spite of the tax hikes at the beginning of the year. The rise in the index there is attributed mainly to the continued improvement in the labor market.
An up trend in consumer confidence was also recorded in Europe as well-despite the recession there-including in peripheral countries. The Consumer Confidence Index of Bank Hapoalim and TNS in Israel is based on a TNS Teleseker monthly poll covering a national sample of 1,000 respondents representing the vast majority of the adult (18+) population of Israel.
