Israel Jan. trade gap widens as imports increase

Israel's trade deficit stood at US$580.8 million in January. Exports totaled US$3.9 billion in January, while imports amounted to US$4.5 billion
 
Israel’s trade deficit widened in January for a second month as imports of raw materials and consumer goods rose. The Central Bureau of Statistics reported last Wednesday that Israel's trade deficit stood at US$580.8 million in January, widening from US$488.6 million deficit in the previous month. A year ago, the trade deficit was US$380.3 million.
 
Exports totaled US$3.9 billion in January, while imports amounted to US$4.5 billion. The deficit, excluding polished diamonds, ships and aircraft, was a seasonally adjusted US$841 million compared with US$683m. in the same month last year. In December, the trade gap widened for the first time in 13 months.
 
“We expect imports to grow by more than exports this year,” Michael Sarel, chief economist at Harel Insurance Investments & Financial Services, said by telephone. “This is because growth in Israel will be faster than growth in the US and Europe, Israel’s main export markets.” The Bank of Israel raised last week its growth forecast for this year to 3.5% from 2.5% on Jan. 11, citing “positive news” on the global and local economies.
 
Growth may top that figure provided the global recovery accelerates, aiding exports.In 2009, Israel posted a trade deficit of $5.1 billion, its narrowest since 1990. Imports rose to $4.15 billion from $3.48 billion a year earlier, the bureau said.
 
Exports increased to $3.31 billion from $2.80 billion. Imports will increase by 11.4% this year after contracting 13.4% in 2009, the Bank of Israel said in a Jan. 11 forecast. Exports will rise by 8.6%.