The Bank of Israel’s Composite State of the Economy Index for August 2016 increased by 0.2 percent, similar to its rate of growth since the beginning of the year. The job vacancy rate that continued to increase in August, the increase in the retail trade revenue index in July, and the increase in building starts in the second quarter contributed to the increase in the Composite Index, In contrast, the Index was impacted to the downside by the decline in goods exports and the decline in goods imports in August as well as declines in the Industrial Production index and the services revenue index in July. 
 
The publication of second quarter building start data and the upward revision in business sector product for the second quarter led to an upward revision in the Composite Index for the fist half of the year. Due to that, the annual growth rate of the Index in the first half of 2016, compared with the preceding half, rose from 2.2 percent to 2.7 percent. There were no material changes in the Index for June or July (Table 1). Table 2 presents the development of components of the Index in the past few months.
 
Table 1: Revisions in the Composite Index
Revision
Previous data
New data
August
 
0.17
July
0.17
0.15
June
0.20
0.23
May
0.14
0.22
 
 


Table 2: Changes in the Index components in recent months
(monthly percent change, unless otherwise noted)
 
 
August  2016
July 2016
June 2016
May  2016
Industrial Production Index (excluding mining and quarrying)
 
-2.9
2.7
0.0
Services Revenue Index (excluding education, and public administration)
 
-2.6
4.0
1.6
Retail Trade Revenue Index
 
2.0
-0.1
0.7
Imports of consumer goods1
-4.5
-1.7
-4.1
4.1
Imports of manufacturing inputs (excluding fuels)1
-2.1
2.3
-1.4
5.3
Goods exports (excluding agriculture) 1
-1.3
-0.6
3.9
-0.5
Services exports (excluding transportation) 1
 
 
7.0
-1.2
Number of employee posts in the private sector
 
 
0.2
-0.2
Rate of vacant employee posts out of total number of employed people in the business sector2
4.1
4.0
3.5
3.9
Building starts3
 
 
10.3
 
 
1 Foreign trade indices are quantitative (in contrast to CBS monthly foreign trade indices).
2 The job vacancy rate is included in the Index at its level, seasonally adjusted and smoothed.
3 Since the Central Bureau of Statistics stopped publishing monthly figures on building starts, beginning in July 2016 the method of calculation of the building starts component of the Index was changed. The component is calculated at a quarterly frequency, and the change (seasonally adjusted, in percent) is attributed to the last month of the quarter for which the figure is published.  The other months in the quarter are missing values for which the variable value is estimated in the model.
 
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