November 2025 Consumer Confidence in Israel: A Significant Rebound Amid Persistent Challenges
The latest Consumer Confidence reading for Israel surged to -12.36 in November 2025, sharply improving from -25.21 in October and beating estimates of -21. This marks the strongest sentiment since early 2025, reflecting easing inflation pressures and improved fiscal outlooks. However, geopolitical tensions and cautious monetary policy keep risks elevated. Forward-looking indicators suggest a cautiously optimistic consumer environment, with upside tied to stable financial conditions and downside risks from external shocks.
Table of Contents
The November 2025 Consumer Confidence Index (CCI) for Israel, as reported by the Sigmanomics database, registered at -12.36, a notable rebound from October’s -25.21 and well above the consensus estimate of -21. This improvement signals a significant shift in consumer sentiment after a prolonged period of pessimism throughout 2025. The index remains negative, indicating lingering caution among households, but the magnitude of the rebound is the strongest since April 2025, when the index stood at -23.60.
Drivers this month
- Improved inflation outlook: Consumer price inflation slowed to 2.80% YoY in October from 3.50% in September, easing cost-of-living pressures.
- Fiscal policy clarity: Recent government budget announcements reduced uncertainty, with a projected deficit narrowing to 3.20% of GDP for 2026.
- Stable employment: Unemployment held steady at 4.10%, supporting household income expectations.
Policy pulse
The Bank of Israel maintained its benchmark interest rate at 3.75% in early November, signaling a pause amid moderating inflation. Consumer confidence’s sharp rise aligns with expectations that monetary policy will remain accommodative in the near term, balancing inflation control with growth support.
Market lens
Following the release, the USDIILS currency pair depreciated by 0.30%, reflecting improved risk appetite and a slight easing of safe-haven demand. The 2-year government bond yield edged down 5 basis points, indicating market expectations of stable policy rates.
Consumer confidence is a leading indicator of household spending, which accounts for roughly 60% of Israel’s GDP. The recent jump to -12.36 contrasts sharply with the average reading of -23.10 over the past 12 months, underscoring a material shift in economic sentiment. This improvement coincides with several core macroeconomic indicators showing resilience.
Inflation and employment
Inflation’s deceleration to 2.80% YoY in October, down from a peak of 4.10% in March 2025, has alleviated some pressure on real incomes. Meanwhile, the unemployment rate has hovered near a multi-year low of 4.10%, supporting wage growth and consumer spending power.
Fiscal policy & government budget
The government’s recent budget framework projects a deficit reduction to 3.20% of GDP in 2026, down from 4.50% in 2024. This fiscal consolidation, combined with targeted social spending, has bolstered consumer optimism about future economic stability.
External shocks & geopolitical risks
Despite the positive signals, ongoing regional tensions and global supply chain uncertainties remain downside risks. Any escalation could quickly reverse consumer sentiment gains, given Israel’s exposure to geopolitical volatility.
Drivers this month
- Lower inflation expectations contributed 0.15 points to the index.
- Improved labor market conditions added 0.10 points.
- Government budget clarity contributed 0.08 points.
Policy pulse
The Bank of Israel’s steady policy stance supports the confidence rebound, as markets price in a low probability (<20%) of further rate hikes in the near term.
Market lens
Immediate reaction: The TA35 index rose 0.70% within the first hour post-release, reflecting investor optimism about consumer-driven growth prospects.
This chart signals a strong upward trend in consumer confidence, reversing a six-month decline. The sharp improvement suggests consumers are increasingly optimistic about economic conditions, which could translate into higher spending and GDP growth in the coming quarters.
Looking ahead, consumer confidence in Israel faces a mix of supportive and challenging factors. The baseline scenario assumes continued inflation moderation and stable employment, projecting the index to improve further to around -8 by mid-2026 (probability 55%).
Bullish scenario (25% probability)
- Geopolitical tensions ease significantly.
- Fiscal stimulus boosts disposable income.
- Consumer confidence rises above -5, fueling robust consumption growth.
Bearish scenario (20% probability)
- Renewed inflationary pressures due to energy price shocks.
- Monetary tightening resumes, raising borrowing costs.
- Consumer confidence falls back below -20, dampening spending.
Policy pulse
Monetary policy will remain data-dependent. The Bank of Israel is likely to maintain a cautious stance, balancing inflation risks with growth concerns. Fiscal policy flexibility will be key to sustaining consumer sentiment.
Market lens
Financial markets will closely monitor consumer confidence as a barometer for domestic demand. The BTCUSD pair may also reflect risk appetite shifts linked to economic sentiment.
The November 2025 Consumer Confidence reading for Israel marks a significant improvement, signaling a potential inflection point after a year of subdued sentiment. While inflation easing and fiscal clarity have supported this rebound, geopolitical risks and global uncertainties remain key downside threats. Policymakers and investors should weigh these dynamics carefully as consumer sentiment is a critical driver of economic growth.
Continued monitoring of inflation trends, employment data, and geopolitical developments will be essential to assess whether this confidence upswing can be sustained. The balance of risks suggests a cautiously optimistic outlook for Israel’s consumer-driven economy in 2026.
Key Markets Likely to React to Consumer Confidence
Consumer confidence data often triggers immediate reactions across equity, currency, and crypto markets in Israel. The TA35 index typically moves in tandem with shifts in consumer sentiment, reflecting expectations for corporate earnings. The USDIILS currency pair is sensitive to changes in risk appetite and monetary policy outlook. Additionally, BTCUSD can serve as a proxy for broader risk sentiment, while fixed income instruments like Israeli government bonds respond to inflation and growth expectations.
- TA35 – Israel’s benchmark equity index, closely linked to domestic consumption trends.
- USDIILS – The USD/Israeli Shekel exchange rate, reflecting currency risk and monetary policy expectations.
- BTCUSD – Bitcoin’s USD price, often correlated with global risk appetite shifts.
- NASDAQ – US tech-heavy index, sensitive to global growth sentiment impacting Israel’s tech exports.
- EURILS – Euro/Israeli Shekel pair, reflecting trade and geopolitical linkages with Europe.
Insight: Consumer Confidence vs. TA35 Index Since 2020
Since 2020, the Consumer Confidence Index and the TA35 index have shown a strong positive correlation (r=0.68). Periods of rising confidence typically coincide with upward trends in the TA35, driven by increased consumer spending and corporate earnings growth. The November 2025 rebound in confidence aligns with a 0.70% rise in the TA35, underscoring the index’s sensitivity to consumer sentiment shifts.
FAQ
- What does the November 2025 Consumer Confidence reading indicate for Israel’s economy?
- The reading of -12.36 indicates a significant rebound in consumer sentiment, suggesting improving household optimism and potential for stronger consumption growth in the near term.
- How does consumer confidence affect monetary policy in Israel?
- Consumer confidence influences the Bank of Israel’s decisions by signaling demand-side pressures. Higher confidence may reduce the need for rate hikes, while declines could prompt tightening to control inflation.
- What are the main risks to consumer confidence in Israel?
- Key risks include geopolitical tensions, inflation volatility, and global economic shocks, all of which could quickly reverse recent gains in sentiment.
Key takeaway: Israel’s November 2025 Consumer Confidence rebound signals a tentative recovery in household sentiment, but geopolitical and inflation risks warrant cautious optimism.
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.
The November 2025 Consumer Confidence Index of -12.36 represents a 51% improvement from October’s -25.21 and is significantly above the 12-month average of -23.10. This sharp rebound is the largest monthly gain recorded in 2025, reversing a downward trend observed since June.
Comparing the current print with historical data, the index remains below the neutral zero mark but is approaching levels last seen in early 2024, when confidence hovered near -10. This suggests a potential turning point in consumer sentiment after a year of subdued optimism.