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A city skyline with apartment blocks and office buildings under construction, in Tel Aviv, Israel, April 22, 2026. Florion Goga
A city skyline with apartment blocks and office buildings under construction, in Tel Aviv, Israel, April 22, 2026. Florion Goga
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Israel economy shrank 3.8% in first quarter amid Iran war

July 16th, 2026 | 10:54 AM MARKETS Asian Markets 1

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By Reuters

Israel's economy shrank an annualised 3.8% ​in the first quarter, ‌the Central Bureau of Statistics said on Thursday, in ​its third estimate ​in which growth was hurt ⁠by Israel's war ​with Iran that ended ​with a ceasefire in April.

The contraction was unrevised from a ​prior estimate a month ​ago.

The economy was hurt by ‌declines ⁠in consumer and government spending and exports, which were offset partly by ​a rise ​in ⁠investment in fixed assets.

Growth is expected ​to have bounced ​back ⁠in the second quarter, with forecasts that the ⁠economy ​would grow about ​4% in 2026.

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