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Bank of Israel resumes easing, cuts policy rate by 25 bps to 3.75%

BY Reuters | ECONOMIC | 09:00 AM EDT

JERUSALEM, May 25 (Reuters) - The Bank of Israel lowered short-term interest rates for the third time in six months on Monday as inflation remained contained despite a war with Iran, while the shekel stands at a three-decade high against the dollar.

The central bank, as expected, reduced its benchmark rate to 3.75% from 4%. It had cut in November and January but paused in its two subsequent decisions due to the conflict with Iran and fears of a spike in supply-driven inflation.

The annual inflation rate held at 1.9% in April, well within a 1-3% target.

The U.S. and Israel launched airstrikes on Iran on February 28. A ceasefire forged on April 8 has held but remains fragile. (Reporting by Steven Scheer; Editing by Toby Chopra)

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