Israel’s Finance Ministry raised an additional 3.7 billion shekels domestically in its weekly bond auction on November 13. “The financial capacity of the State of Israel allows the Government to fully and optimally finance all its needs,” the General Accounting Office of Israel said.
The Israeli military campaign in Gaza is extremely "money-burning". Photo: Reuters
The war since October 7 has sharply increased Israel’s costs to fund its military and compensate businesses near the border and the families of victims and hostages held by Hamas. At the same time, tax revenues have fallen significantly.
As a result, Israel recorded a budget deficit of 22.9 billion shekels in October, a sharp increase from 4.6 billion shekels in September and pushing the deficit over the previous 12 months to 2.6%.
Prime Minister Benjamin Netanyahu has vowed to sharply increase spending to help those affected by the conflict, which economists believe will push up Israel's deficit and debt-to-GDP ratio between now and 2024.
But Bank of Israel Governor Amir Yaron said the Israeli government needed to strike a balance between “supporting the economy and maintaining a healthy fiscal position”. Credit rating agencies have warned they could cut Israel’s rating if debt figures deteriorate.
Hoang Nam (according to Reuters)
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