Israel's central bank governor Amir Yaron has urged Israeli Prime Minister Benjamin Netanyahu and his government to continue preparing the country's 2025 budget, the Financial Times reported, quoted by BTA.
Israel's budget is expected to be revised next year as the country faces a growing budget deficit due to the economic fallout from the Gaza war.
In a letter to Benjamin Netanyahu, the Israeli central banker criticized the fact that "no serious discussions have been held on draft budget". This casts doubt on the timely adoption of the basic financial law. This uncertain situation undermines the confidence in Israel on the part of international financial markets, the central bank governor said.
He noted that the Israeli government must include "permanent adjustments" in the draft budget. Through them, another 30 billion shekels (about 8 billion dollars) should be guaranteed to cover the budget deficit. It is expected to reach 8 percent of the country's gross domestic product (GDP).
Israeli defense spending has increased significantly since the Islamist group "Hamas" carried out an attack on Israel on October 7, 2023. This was followed by a military operation by the Israeli army in the Gaza Strip, run by "Hamas", which escalated into a war, analysts recall.
Against this backdrop, last week the international rating agency "Fitch" lowered Israel's long-term credit rating by one notch - from "A+" to "A".