July 9, 2018 / 1:05 PM / in 11 days

Bank of Israel holds benchmark interest rate at 0.1 pct

JERUSALEM, July 9 (Reuters) - The Bank of Israel on Monday left its benchmark interest rate unchanged at 0.1 percent for the 35th straight time since early 2015, as inflation continues to climb towards its target while economic growth remains solid.

The decision came three days after Governor Karnit Flug said she would not seek a second-five year term when her tenure ends in November.

All 13 economists polled by Reuters had forecast no change by the central bank, which is widely expected to leave rates unchanged until at least later in 2018 before tightening policy.

Israel’s annual inflation rate gained to 0.5 percent in May from 0.4 percent in April, but it still remained below the government’s target of 1 to 3 percent.

At the same time, Israel’s economy grew an annualised 4.5 percent in the first quarter, according to a second estimate. Growth is forecast around 3.4 percent this year. (Reporting by Steven Scheer; Editing by Tova Cohen)

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