JERUSALEM, May 24 (Reuters) - Israel's central bank will probably raise its 2011 economic growth estimate as the economy has expanded more rapidly than expected, Bank of Israel Governor Stanley Fischer said on Tuesday.
'I have little doubt that when we update our forecasts, the forecasts will be higher than they are now,' Fischer told a conference, declining to give specific numbers.
In March, the Bank of Israel raised its 2011 growth projection to 4.5 percent from 4.0 percent after data showed fourth-quarter growth of an annualised 7.7 percent.
Growth in the final three months of 2010 has been revised to 7.6 percent, while the economy grew 4.7 percent in all of 2010 -- above the central bank's 4 percent forecast.
The economy remained strong in the first quarter of 2011, growing an annualised 4.7 percent. Robust growth, along with inflation expectations the central bank deems as too high, prompted the Bank of Israel to raise its benchmark lending rate by a quarter point to 3.25 percent on Monday, surprising many in the market.
In the statement accompanying the fourth rate hike in the past five months and the 10th in the current tightening cycle, the central bank alluded to the fact growth is running above its forecast.
'Data for the first quarter are consistent with a growth rate higher than that in the most recent (Bank of Israel) research department forecast of 4.5 percent GDP growth in 2011,' the central bank said.
Fischer said the central bank had been most surprised by the strength of exports despite a strong shekel.
(Reporting by Steven Scheer; Editing by Susan Fenton) Keywords: ISRAEL FISCHER/ECONOMY (steven.scheer@thomsonreuters.com; +972 2 632 2210; Reuters Messaging: steven.scheer.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
'I have little doubt that when we update our forecasts, the forecasts will be higher than they are now,' Fischer told a conference, declining to give specific numbers.
In March, the Bank of Israel raised its 2011 growth projection to 4.5 percent from 4.0 percent after data showed fourth-quarter growth of an annualised 7.7 percent.
Growth in the final three months of 2010 has been revised to 7.6 percent, while the economy grew 4.7 percent in all of 2010 -- above the central bank's 4 percent forecast.
The economy remained strong in the first quarter of 2011, growing an annualised 4.7 percent. Robust growth, along with inflation expectations the central bank deems as too high, prompted the Bank of Israel to raise its benchmark lending rate by a quarter point to 3.25 percent on Monday, surprising many in the market.
In the statement accompanying the fourth rate hike in the past five months and the 10th in the current tightening cycle, the central bank alluded to the fact growth is running above its forecast.
'Data for the first quarter are consistent with a growth rate higher than that in the most recent (Bank of Israel) research department forecast of 4.5 percent GDP growth in 2011,' the central bank said.
Fischer said the central bank had been most surprised by the strength of exports despite a strong shekel.
(Reporting by Steven Scheer; Editing by Susan Fenton) Keywords: ISRAEL FISCHER/ECONOMY (steven.scheer@thomsonreuters.com; +972 2 632 2210; Reuters Messaging: steven.scheer.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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