Bank of Israel Holds at 3.25%: What It Means for You

The short version. On October 21, the Bank of Israel left its key rate at 3.25%. That is its lowest level in about four years, following the September cut (from 3.50% to 3.25%). All 15 economists polled by Reuters expected this pause, a week before the election. The central bank pointed in particular to a weaker shekel in recent weeks.

What it changes for you

Mortgage. The variable part of a mashkanta tied to prime (key rate + 1.5%, i.e. 4.75%) is stable this month. The economists quoted by Reuters see a further cut toward 3% as likely in the coming months, but nothing is certain. To compare bank offers, see our sister site Kinyan Guide.

Savings. Shekel time deposits follow the key rate and stay close to their October levels.

Shekel and transfers. The bank notes a recent depreciation of the shekel. For anyone converting dollars or euros, a slightly weaker shekel means slightly more shekels received. The gap between the market rate and your bank’s rate often weighs more than the move in the rate itself: see the comparison.

The bank’s forecasts

The Bank of Israel raised its growth forecast to 5.6% for 2026 (from 4%) and 7.5% for 2027 (from 5.5%). The date of the next decision is published on the central bank’s website. We will update this article at each decision.

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