First-quarter economic growth down to 2.7%

The CBS revised downwards its GDP growth estimate for the first quarter of 2012
 
The Central Bureau of Statistics (CBS) of Israel revised downwards its GDP growth estimate for Q1/12, noting that Israel’s economy expanded an annualized 2.7% in the three months through March, revising the figure down for a second time as export markets stall.
 
The new figure marks the fifth consecutive decline in GDP growth since it peaked at a 7.4% rate in the final quarter of 2010. The economy grew at a 3.2% rate in the third quarter of 2011 and a 3.1% rate in the final quarter, according to the CBS.
 
Growth slowed from 3.1% in the previous three months. The CBS’s initial estimate for growth in the first quarter was 3%, and that was revised down to 2.9% last month. The 2.7% increase in first-quarter GDP reflects growing imports, consumer spending, investment in fixed assets and higher government spending. The area that hurt growth the most was exports, which dropped at an 8.8% annual rate in the three months.
 
The CBS reported a slowdown in exports, imports, consumption, and investment growth. Business product growth fell sharply to an annualized 2.2% in the first quarter, from 3.4% in the preceding quarter and 4.4% in the third quarter of 2011. Private consumption per capita rose by an annualized 2.1% in the first quarter, after falling by an annualized 1.8% in the preceding quarter.
 
However, private consumption per capita of durable goods, an indication of the standard of living, fell by an annualized 2.2% in the first quarter. This is the second consecutive quarter in which this item has fallen. Investment in residential construction rose by an annualized 10.5% in the first quarter.