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JERUSALEM, Feb 20 (Reuters) - Bank of Israel Deputy
Governor Andrew Abir suggested on Monday that more interest rate
increases were possible as inflation remains "sticky" above a 5%
rate.
He was speaking to Reuters the central bank raised its
benchmark interest rate by a half a percentage point
to 4.25%, its highest level since late 2008.
Abir said in choosing the more aggressive move, rather than
a quarter-point rise, "it's important to show our determination
to bring down the level of inflation."
Last month Abir had said the terminal rate would be 4%
or a bit above but on Monday, he declined to project a peak,
saying much depended on future data.
"Monetary policy-tightening is working, but we still
think we've got some way to go in order to bring inflation down
to our target," Abir said in an interview.
Israel's inflation rate hit a 2008 high of 5.4% in
January, above an official annual target of 1-3%.
"Inflation is quite sticky. Services inflation is quite
sticky," Abir said, adding that price pressures were mainly
demand-driven.
(Reporting by Steven Scheer and Ari Rabinovitch, editing by
Mark Heinrich)
Messaging: steven.scheer.thomsonreuters.com@reuters.net;
Twitter: @StevenMScheer))
