FX.co ★ Israel’s Economy Expands 3.5% in Q1

In the first quarter of 2025, Israel's economy expanded at an annualized rate of 3.5%, according to the latest third estimate. This figure represents a slight decrease from the prior estimate of 3.7%, yet shows a marked improvement over the revised growth rate of 1.9% observed in the last quarter of 2024. The increase was primarily fueled by a robust 6.2% rise in gross fixed capital formation and a modest 0.1% uptick in government expenditure, despite a 4.1% decline in household consumption. On the trade front, there was a 0.2% decrease in exports of goods and services, contrasted by a 6.2% increase in imports. In light of ongoing geopolitical uncertainties, the Bank of Israel has revised its growth forecast for the year downward to 3.5% from the previous projection of 4.0%.