Israel's annual inflation rate rose for the 10th straight month in June, data from the Central Bureau of Statistics showed on Sunday, moving above the 1 percent level for the first time in more than four years. Boosted by base effects in which a large monthly drop in June 2017 dropped out, the consumer price index showed prices gained 1.3 percent from a year earlier, versus a 0.5 percent increase in May. It was the highest inflation rate since March 2014.
Analysts polled by Reuters had predicted a 1.3 percent rise. Inflation in 2017 was 0.4 percent, as prices in the full year rose for the first time since 2013. Compared with May, consumer prices rose 0.1 percent in June, led by gains in housing rentals, fuel, fresh produce, food and transportation and telecommunications. These were partly offset by declines in clothing and footwear, and education, culture and entertainment costs. Expectations that inflation would stay below the government's 1-3 percent target in the near term drove the Bank of Israel to cut benchmark interest rates in early 2015 to 0.1 percent from 0.25 percent.
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