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Horowitz Urges Reduced Government Spending, Curbs on Credit to Prevent Inflation

April 23, 1968
See Original Daily Bulletin From This Date

The Governor of the Bank of Israel warned the Government today of incipient inflation and signs that price stability in Israel might be endangered following last year’s policy of economic slow-down, David Horowitz reported at a Cabinet meeting that the cost of living index rose by 3.5 percent between September, 1967 and March, 1968. There was no increase during the corresponding period of the previous year.

Israel law requires the Governor of the Bank of Israel to report to the Cabinet whenever there is an increase of 15 percent or more in the currency in circulation or credit outstanding. Mr. Horowitz reported today that the increase was 15.5 percent during the nine months ending on Jan. 31, 1968. He recommended a curb on public spending for development and a ban on the acceptance of credit abroad by non-governmental bodies.

A forecast that the unemployment total in Israel will drop to 13,000 by the end of the year, less than one-third the rate of March 1967 was made here by Hanoch Lev-Kochav, director-general of the Labor Ministry, He told a press conference today that new industrial enterprises would create employment for some 24,000 job-seekers this year, mainly veterans and immigrants.

Mr. Lev-Kochav said that a sharp drop in unemployment had taken place during the past year. The unemployment figure for March of this year was 18,000, he said, compared to 45,000 in March, 1967. Most of the jobless persons were provided with relief work. He also said that the employment in Judea and Samaria on the West Bank improved this year under Israeli rule.

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