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BoI ends asset purchases, rate hike now likely in 2022

The Bank of Israel revised up its forecast for GDP growth at today’s meeting and struck a more hawkish tone on inflation as it announced that it will end its asset purchase programme later this year. This was in line with expectations, but Governor Yaron also suggested a possibility of an interest rate hike in 2022 and we now think that a 15bp rate hike will be delivered in the second half of next year.

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