Israel’s economy showed a significant rebound in the first quarter of 2024, following a sharp contraction at the end of 2023 that was triggered by the start of the war in Gaza with Palestinian Islamist group Hamas in October. According to the Central Bureau of Statistics, the gross domestic product (GDP) grew by an annualized 14.1% in the January to March period, slightly below the Reuters consensus of 15.3%. The growth was fueled by a resurgence in consumer spending and increased investment, particularly in residential building.
Despite ongoing challenges posed by the conflict in Gaza, Israel’s economy has shown resilience and is starting to recover. The increase in consumer spending and investment is a positive sign for the country’s economic recovery. However, it remains uncertain how long this momentum will continue given that the war continues to be ongoing.
According to data from the Central Bureau of Statistics, Israel’s fourth-quarter GDP was revised to show a 21.7% contraction compared to its initial estimate of a 21.0% decline in economic activity due to the conflict. This suggests that Israel’s economy is on track to recover after being hit hard by the turmoil caused by this conflict.
The conflict began on October 7th when Hamas launched a cross-border attack on southern Israel. Despite this, Israel’s economy has shown remarkable resilience and has been able to bounce back stronger than expected after just one quarter since it happened.
