Israel's budget deficit has grown to 110 billion shekels ($32 billion) or 8.1% of gross domestic product the 12 months ending Aug. 31, 2020 – up from 7.2% at the end of July, 6.4% at the end of June and 6% at the end of May, the Finance Ministry said Monday.
The deficit has been steadily growing since the coronavirus crisis hit Israel in mid-March, plunging the country into a recession. Prior to the pandemic, the deficit stood at 4.8% of the GDP at the end of April, 4% at the end of March and 3.1% at the end of February.
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The ministry believes that Israel's deficit could reach 10% or 11% by the end of 2020.
The government has so far injected NIS 34.5 billion ($10 billion) into the economy through various bailout programs seeking to help the economy recover from a two-month lockdown that has left the private sector reeling and saw unemployment soar.
Also on Monday, the Bank of Israel said the country's foreign currency reserves have reached a record $161.6 billion.
Foreign currency reserves increased by $4 billion in August and currently represent 40.6% of GDP, the bank said on its website, adding that reserves have increased by 35% over the past 12 months, from $119.8 billion to $161.6 billion.
In the past four months the central bank has purchased $7.5 billion in foreign currency in attempts to weaken the shekel, yet the Israeli currency remains at its strongest for 12 years against the dollar.
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