Bank of Israel warns deficit could widen amid wartime spending

The Bank of Israel has urged the government to reduce coalition funds and avoid introducing new programmes unrelated to the war effort, warning that recent fiscal decisions could significantly widen the national deficit. The warning came after the Israeli government approved budget amendments and an increase in the deficit to finance the ongoing war with Iran. According to the business newspaper The Marker, the central bank expressed concern that expanding the deficit while simultaneously approving tax reductions could lead to a rising public debt ratio in the coming years. This, it said, could increase the burden of interest payments and limit the government’s fiscal flexibility. READ: US spends over $11 billion in first week of war against Iran Despite being legally […]