To full publication (hebrew)

To full paper (hebrew) ​


Part
one
of the bulletin is intended to provide the public with easy and
friendly access to the main data and aggregates regarding financial activity in
Israel, together with information and explanations about the data, definitions
and calculations, regarding four main topics in Israel’s financial statistics:
the public’s financial assets portfolio; nonfinancial private sector debt;
Israel’s economic activity vis-à-vis abroad; and foreign exchange activity of
the principal sectors.

 

a.     
The public’s
financial assets portfolio

·   The balance of the public’s
financial assets portfolio continued to increase in 2016, mainly in the cash,
current accounts, and deposits components.

·    The downward trend of the
portion of the portfolio managed directly by the public (including mutual
funds) continued during the year, in parallel with an increase in the portion
of the portfolio managed by institutional investors.

·   The decline in mutual fund
balances in the asset portfolio continued, against the background of continued
net redemptions from money market funds and some of the funds specializing in
bonds.

·     In 2016, the rate of
exposure of most institutional investors to foreign assets declined for the
first time since 2008.​


b.     
Nonfinancial private
sector debt​

·      The increase in outstanding
household debt continued in 2016, but the increase was slightly less than in
2015 (6.2 percent compared with 6.5 percent).

·      Similar to the previous two
years, there was a greater increase in nonhousing debt than there was in
housing debt, where there has been a marked continued slowdown.

·     Outstanding nonfinancial
private sector debt continued to increase in 2016, at a higher rate (4.9
percent) than in the previous year.  This
increase is mainly due to a quantitative increase in debt of both the business
sector and households.

·    Outstanding business sector
debt increased by about 4.1 percent in 2016—a higher rate of increase than in previous
years. Most of the increase was concentrated in debt to nonbank entities
through tradable bonds.  The increase in
debt to banks was slower than in previous years.​

c.     
Israel’s economic
activity vis-à-vis abroad

·    The increase in surplus
assets over liabilities vis-à-vis abroad accelerated in 2016, aided by
contrary developments in the stock indices—an increase in stock prices abroad
and a decline in stock prices in Israel.

·    The net flow of investments had a smaller effect on the
balance of surplus assets this year than in previous years.​

·     In 2016, the upward trend
in the balance of Israel’s assets abroad continued, mainly due to a significant
volume of direct investments abroad by Israelis, the continued increase in
foreign currency reserves, and an increase in global capital market prices.

·     Contrary to previous years,
net financial investments by the private sector in foreign stocks and bonds was
particularly low.  The decline in the
volume of investments abroad was characteristic of all portions of the
nonbanking private sector.

·      Israel’s liabilities to
abroad declined in 2016, in contrast with the increase in 2015.  The flow of net direct and financial
investments by nonresidents continued, but it was more than offset by a sharp
decline in the prices of Israeli stocks held by nonresidents.

 



 

d.     
Foreign exchange
activity of the principal sectors

·    Due to the increase in the
import of goods and services in 2016, there was an increase in foreign exchange
purchases by importers, in parallel with a moderation of foreign exchange sales
by exporters.

·   In 2016, nonresidents made
net sales of foreign exchange and reduced their exposure to an appreciation of
the shekel.  In contrast, the business
sector made a significant volume of net purchases of foreign exchange, mainly a
result of increasing foreign exchange purchases by importers.  Institutional investors also made net foreign
exchange purchases, at a moderate volume.

·    The shekel strengthened
moderately against the dollar in 2016, while the dollar strengthened against
the major currencies.  The shekel
strengthened by a more significant rate in terms of the nominal effective
exchange rate.​

Part two of the bulletin presents three studies in the field of
statistical methodology:

 

a.     
Measuring institutional
investors’ exposure to foreign exchange and foreign assets

 

Institutional investors are entities that manage the public’s long-term
savings, and are important players in the financial system.  As part of the regular monitoring of their
activity, the Bank of Israel’s Information and Statistics Department estimates
the exposure of savers to various risks in the portfolio managed for them by
the institutions.  This work focuses on
measuring exposure to foreign exchange and exposure to foreign assets,
outlining the data and their sources, defining the exposures, and providing a
graphic demonstration of the main data.

 

b.     
Seasonal Adjustments
in Economic and Financial Series at the Bank of Israel—A Demonstration of the
“New Mortgages Taken Out” Series

 

“Seasonal adjustment” is a statistical procedure through which the
effects of the calendar on a time series are estimated and deleted from the
series.  Applying this procedure to time
series economic and financial data helps in reaching more correct conclusions
regarding economic developments.  This
work is intended to expand upon and deepen knowledge regarding seasonal
adjustment and to demonstrate how the Bank of Israel applies it to the “New
Mortgages Taken Out” series.

 



 

c.      
Measuring direct
investment as a part of the International Investment Position

 

An analysis of direct investment data shows the robustness of the
domestic market and the extent of its openness and attractiveness to foreign
investors.  These figures are used to in
an economic analysis of financial activity vis-à-vis abroad, and in building
the balance of payments of the Israeli economy. 
This work focuses on measuring direct investments as a part of Israel’s
assets and liabilities vis-à-vis abroad (the International Investment
Position), presents the main terms and definitions in the IIP, and demonstrates
the possible uses of direct investment data.

 

 

 

The full publication (in
Hebrew) can be accessed on the Bank of Israel’s website, including—for the
convenience of users—the main data on each topic, in separate files, as well as
links to regularly updated data on the Bank’s website.  The English version of the bulletin will be
published in the near future.