Israel's central bank expects GDP to grow 6.3 pct in 2021 if COVID-19 vaccination goes fast

Source: Xinhua| 2021-01-05 03:34:14|Editor: huaxia

JERUSALEM, Jan. 4 (Xinhua) -- Israel's GDP is expected to expand 6.3 percent in 2021 and 5.8 percent in 2022, according to an annual forecast released by the state's central bank on Monday.

This forecast is based on a scenario of rapid COVID-19 vaccination, according to which the entire population of Israel will be vaccinated by May this year.

Since the start of the vaccination campaign in Israel on Dec. 20, 2020, more than 1 million people, or about 10 percent of the 9.3 million population, have been vaccinated.

According to a second scenario presented by the bank, however, if vaccination will be completed only in June 2022, the Israeli economy will grow by 3.5 percent in 2021, and by six percent in 2022.

In both scenarios, Israel's GDP in 2020 is expected to contract by 3.7 percent.

In the rapid inoculation scenario, annual inflation in 2021 is expected to be 0.6 percent, and 0.9 percent in 2022, compared to a deflation of 0.6 percent recorded in 2020.

The government deficit is expected to be eight percent of GDP in 2021 and 3.6 percent of GDP in 2022.

In the slow inoculation scenario, annual inflation is expected to be 0.1 percent in 2021, and 0.8 percent in 2022.

In this scenario, the government deficit is expected to be about 11 percent of GDP in 2021 and six percent of GDP in 2022. Enditem