Israel Economy Rebounds Strongly in Q2

2026-08-17 06:52 By Kyrie Dichosa 1 min. read

Israel’s economy grew at an annualized rate of 15.4% in the second quarter of 2026, rebounding sharply from a revised 2.2% contraction in the first quarter as the impact of the war with Iran eased.

The growth easily beat market expectations of 6.9%, with the Central Bureau of Statistics saying the Q2 rebound was driven by strong gains in private and public consumption and exports, following sharp declines in these areas in Q1.

Exports of goods and services, excluding startups and diamonds, jumped 25.2%, while imports of goods and services, excluding defense imports, rose 22.7%.

Government consumption climbed 19.5%, while private consumption advanced 14.7%.

Fixed capital formation also grew 6.3%.

The Bank of Israel raised its 2026 growth forecast to 4% last month and expects growth to accelerate to 5.5% in 2027.



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Israel Economy Rebounds Strongly in Q2
Israel’s economy grew at an annualized rate of 15.4% in the second quarter of 2026, rebounding sharply from a revised 2.2% contraction in the first quarter as the impact of the war with Iran eased. The growth easily beat market expectations of 6.9%, with the Central Bureau of Statistics saying the Q2 rebound was driven by strong gains in private and public consumption and exports, following sharp declines in these areas in Q1. Exports of goods and services, excluding startups and diamonds, jumped 25.2%, while imports of goods and services, excluding defense imports, rose 22.7%. Government consumption climbed 19.5%, while private consumption advanced 14.7%. Fixed capital formation also grew 6.3%. The Bank of Israel raised its 2026 growth forecast to 4% last month and expects growth to accelerate to 5.5% in 2027.
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