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Business sector debt increased in the second quarter of 2016 by about NIS 13.9 billion (1.7 percent), to about NIS 829 billion. Household debt increased in the second quarter by about NIS 9.2 billion (1.9 percent), to around NIS 489 billion.
 
      The business sector’s outstanding debt
 
·     In the second quarter of 2016, business sector debt increased by about NIS 13.9 billion to around NIS 829 billion. The increase derived mainly from a quantitative increase of about NIS 8.1 billion in bonds traded in Israel, bank loans and nonbank loans. The depreciation of the shekel vis-à-vis the dollar by about 2.1 percent, and the increase in the Consumer Price Index by about 0.5 percent—factors which increased the value of debt denominated in and indexed to foreign exchange and of CPI-indexed debt—also contributed to the increase in debt.  The increase in debt was partly offset by a quantitative reduction in loans from abroad.
·     In July 2016, the business sector (excluding banks and insurance companies) issued about NIS 4.9 billion in bonds, mostly in tradable bonds, significantly higher than the average in the first half of the year (about NIS 2.8 billion).
Business sector issuances in Israel (excluding banks and insurance companies) in the second quarter totaled about NIS 9.9 billion, mostly in tradable bonds, higher than the total issuances in the first quarter (about NIS 6.9 billion).  The real estate and construction industry was a prominent issuer during the second quarter (about 36 percent of total issuances) after being prominent in the first quarter as well.
·     The spread between yields on CPI-indexed corporate bonds, as measured by the Tel Bond 60 index, and the yield on CPI-indexed government bonds declined by an average of about 0.19 percentage points in the second quarter, to about 1.38 percentage points, further to the decline in the first quarter
In July, this spread continued to narrow to about 1.27 percentage points.
 
 

Household debt

 

·     Households’ outstanding debt increased by about NIS 9.2 billion (1.9 percent) in the second quarter of 2016, to about NIS 489 billion. Since the beginning of the year, outstanding household debt increased by about NIS 15 billion (3.2 percent).
The balance of outstanding housing debt increased by about NIS 7 billion (2.2 percent) in the second quarter, to about NIS 331 billion. Outstanding non-housing debt increased by about 1.4 percent (about NIS 2 billion) in the second quarter.
·     In the second quarter of the year, new mortgages taken out totaled about NIS 15.6 billion, slightly higher than total new mortgages taken out during the previous quarter (NIS 14.9 billion) (Figure 4).