16.6.2005
 
The Expected Rate of Inflation and Changes in the (M1) Money Supply
 
  Expected inflation rate (percent) M1 money supply
  Calculated from capital market Average inflation forecastcc 12 months forward Average monthly balance (NIS billion) Rate of change (percent)
  for first year a For second yearb For third year and after Monthly Previous 12 monthsd
December 2001 0.6 1.3 2.5 1.6 29.2 4.1 15.3
December 2002 2.2 3.8 5.4 2.0 30.6 2.7 4.9
December 2003 0.7 2.6 2.8 1.6 33.0 1.7 7.7
2004
January 0.9 2.1 3.3 1.5 34.3 4.0 10.4
February 1.1 2.5 3.5 1.7 34.8 1.5 11.7
March 1.2 2.8 3.4 1.7 35.6 2.3 14.1
April 1.6 3.0 3.6 2.0 36.9 3.5 18.6
May 2.0 3.1 3.6 2.6 36.8 0.3- 17.0
June 1.7 2.6 3.7 2.3 36.9 0.3 21.0
July 1.5 2.2 3.8 2.0 38.0 2.8 22.2
August 1.9 2.6 3.9 2.4 38.5 1.5 20.5
September 2.0 2.3 3.7 2.5 39.6 2.7 22.8
October 2.0 2.5 3.6 2.4 39.2 1.0- 21.3
November 1.9 2.0 3.4 2.2 38.4 1.9- 18.5
December 1.4 1.9 3.5 2.0 38.9 1.2 17.9
2005
January 1.6 2.0 3.3 2.0 39.8 2.4 16.1
February 2.0 2.4 3.1 2.2 40.7 2.2 16.9
March 2.2 2.4 3.1 2.1 41.0 0.9 15.3
April 2.0 2.0 3.1 2.1 42.7 4.0 15.8
Maye 1.7 1.9 3.0 1.9 42.5 -0.4 15.7
Last 30 daysf 1.6 1.8 2.9        
 
a Expectations for the next twelve months. Calculated on the basis of gross returns. For an explanation of the calculation see Appendix 1 in Inflation Report No. 5, July–December 1999. Since January 2004 various changes were introduced in the method of calculating inflation expectations: seasonal factors in the CPI are taken into account, price changes that have taken place but have not been published are incorporated fully, and the calculation is on a continuous basis. A more detailed account of the method of calculation is due to appear shortly in the Discussion Paper series of the Monetary Department.
b Based on the return on Shahar bonds, or on Galil or Sagi bonds for equivalent periods.
c Simple arithmetic mean of the inflation forecasts of the commercial banks and economic consultancy companies that publish their forecasts on a regular basis.
d The percentage change in the level in the current month compared with the level in the equivalent month in the previous year.
e Money supply data are preliminary data.
f Average inflation expectations over previous thirty days