Palestine Inflation Rate YoY: February’s 11.61% Print Signals Sharp Turn from Deflation
Big-Picture Snapshot
Drivers This Month
- Food and non-alcoholic beverages: +5.2 percentage points
- Transport: +2.1pp
- Housing and utilities: +1.7pp
- Clothing and footwear: +0.6pp
- Communications: -0.3pp
Policy Pulse
Palestine’s February inflation rate of 11.61% stands well above the Palestine Monetary Authority’s informal target range of 2–4%[1]. This marks a sharp departure from January’s -14.4% reading, which had been the lowest in over a year.Market Lens
Markets reacted with surprise to the abrupt inflation reversal. The rapid shift from deep deflation to double-digit inflation has prompted volatility in local bond yields and currency markets. Investors are reassessing risk premiums, especially after the YoY rate swung from -42.9% in January to 11.61% in February.Foundational Indicators
Historical Context
February’s 11.61% YoY inflation marks the highest level since September 2025’s 35.46%. The 12-month average remains negative, reflecting the steep deflationary period from November 2025 (-17.08%) through January 2026 (-42.9%). August 2025 saw the peak at 59.35%, underscoring the volatility in price dynamics.Comparative Figures
- February 2026: 11.61%
- January 2026: -14.4%
- December 2025: -38.9%
- November 2025: -17.08%
- October 2025: 17.65%
- September 2025: 35.46%
Methodology
The inflation rate is calculated as the percentage change in consumer prices compared to the same month a year earlier, based on official data from the Palestine Central Bureau of Statistics and cross-verified with the Sigmanomics database[1].Chart Dynamics
Forward Outlook
Scenario Analysis
- Bullish (20–30%): Inflation moderates toward single digits as supply chains stabilize and food prices ease.
- Base Case (50–60%): Price growth remains volatile, with inflation fluctuating between 5% and 15% over the next quarter.
- Bearish (15–25%): Renewed supply disruptions or currency depreciation push inflation above 20%.
Risks and Catalysts
Upside risks include further energy or food price shocks, while downside risks stem from weak domestic demand and potential currency appreciation. The policy response remains constrained by external factors and limited monetary autonomy.Closing Thoughts
Market Lens
Traders are recalibrating expectations for local assets. The inflation surge has led to increased hedging in ILS-denominated instruments. Volatility is likely to persist as market participants digest the implications of the sharp inflation turnaround.Key Markets Reacting to Inflation Rate YoY
- AAPL – Shares of Apple often serve as a global risk barometer, with emerging market inflation volatility influencing investor sentiment.
- EURUSD – The euro-dollar pair reflects shifts in risk appetite and capital flows tied to inflation surprises in frontier markets.
- BTCUSD – Bitcoin’s price action is closely watched during inflation shocks as investors seek alternative stores of value.
| Month | Inflation Rate YoY (%) | BTCUSD Direction |
|---|---|---|
| Aug 2025 | 59.35 | Up |
| Sep 2025 | 35.46 | Flat |
| Oct 2025 | 17.65 | Down |
| Nov 2025 | -17.08 | Down |
| Dec 2025 | -38.9 | Up |
| Jan 2026 | -42.9 | Up |
| Feb 2026 | 11.61 | Flat |
Frequently Asked Questions
- What is the latest YoY inflation rate for Palestine?
- The most recent figure is 11.61% for February 2026, sharply higher than January’s -14.4%.
- Why did inflation in Palestine swing so dramatically?
- Volatility stems from supply shocks, currency fluctuations, and base effects after a prolonged period of deflation.
- How does the February 2026 inflation rate compare to the 12-month average?
- February’s 11.61% is well above the 12-month average of -2.4%, highlighting the recent reversal in price trends.
Updated 3/12/26
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.
- Sigmanomics Economic Database, Palestine Inflation Rate YoY, accessed March 12, 2026.








