Israel

Israel GDP Q4 2023

Israel: Economy records sharpest contraction since Q2 2020 in Q4

GDP fell 19.4% in seasonally adjusted annualized rate terms (SAAR) in the fourth quarter of 2023, contrasting the 1.8% expansion recorded in the third quarter and a larger contraction than markets were expecting. Q4’s reading marked the worst result since Q2 2020. The downturn reflected contractions in private consumption, fixed investment and exports; all three indicators were hit hard by the conflict with Hamas. In contrast, government spending surged due to war-related expenditure. On an annual basis, economic activity dropped 4.1% in Q4, contrasting the previous period’s 3.6% growth. Q4’s reading marked the largest drop since Q2 2020.

Private consumption fell 26.9% SAAR in Q4 compared to a 1.2% expansion in Q3. Moreover, fixed investment dropped at a quicker rate of 67.8% in Q4, compared to the 1.5% decrease logged in the prior quarter. Government consumption, meanwhile, grew at the fastest pace on record, expanding 88.1% (Q3: +7.9% SAAR).

On the external front, exports of goods and services contracted 18.3% in Q4, marking the worst reading since Q2 2020 (Q3: +3.6% SAAR). In addition, imports of goods and services deteriorated, contracting 42.4% in Q4 (Q3: +2.3% SAAR).

Our Consensus is for growth to return in quarterly terms in Q1 2024, though the ongoing war against Hamas will continue to weigh on activity somewhat.

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest X Download Fullscreen