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Bank of Israel Raises Interest Rates

The Bank of Israel raised interest rates by half a percent Monday in another effort to curb inflation and combat the widening trade deficit.

In response to the move, commercial banks raised their lending rates by the same amount.

Both the Histadrut trade federation and industrialists blasted the move, saying it would hurt export profits.

The trade deficit is expected to reach $10 billion in 1995.

Prices rose only 5 percent in the first nine months of the year, which was within the government’s 1995 inflation goal of 8 percent to 11 percent.

In 1994, prices rose 14.5 percent.

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