JERUSALEM (Aug. 1)
The Pound was devalued last night for the third time in a month and now stands at IL 9.83 to $1. The latest devaluation which took effect at midnight, brought to six percent the total depreciation of the Pound during the four-month period that ended yesterday. The law allows automatic devaluations by the Treasury of up to eight percent in any four-month period without recourse to the Cabinet.
Yesterday, the Cabinet approved an IL 123.96 billion budget for the current fiscal year which assumes a rise in the consumer price index of 28 percent. Mini-devaluations for the full year will amount to 20 percent and the rate of the Pound to the dollar is expected to stand at IL II- $1 by the end of the fiscal period, March, 1978.
The budget, submitted to the Knesset today, also envisions a gradual increase in the prices of government subsidized goods and services such as bread, milk and public transportation. Although the budget projects a 2-3 percent rise in private consumption this year, living standards will not rise significantly. Nevertheless, increased prices will be offset by increased wages.
The Central Bureau of Statistics published a survey yesterday which showed that the average salary has risen faster than the consumer price index. The average salary was IL 3840 in March, 44 percent higher than in March, 1976. Average salaries in the first quarter of 1977 were 11 percent higher than in the last quarter of 1976, the CBS disclosed.
Theoretically, the Treasury can devalue the Pound by a further rate of up to eight percent beginning today. It is not expected to announce new devaluations, however, until Finance Minister Simcha Ehrlich studies the economic situation. The second quarter of this year was outside the norm because the elections were held during that period.