The cost of Israel's attacks on the blockaded Gaza Strip, which have continued since October 7, as well as the army's declaration of mobilization and the slowdown in economic activity in the country, is increasing.
International credit rating agency Standard's Poor affirmed Israel's credit outlook at "AA-". Previously, Fitch Ratings had also downgraded Israel's credit rating to negative and Moody's had announced that Tel Aviv's credit rating was on watch.
In its statement, Standard's Poor's pointed out that the war in Gaza could have a heavy burden on the Israeli economy and public finances. Standard Poor's experts assessed that "the Israeli-Palestinian conflict could spread to a wider area and credit indicators could be more negatively affected."
Bloomberg noted that investors were shifting away from Israeli assets ahead of any Israeli military ground incursion into Gaza amid uncertainty over how geopolitical tensions will play out.
Israeli shekel at 14-year low
The Israeli shekel, which depreciated against international currencies against the controversial judicial regulation of Prime Minister Binyamin Netanyahu's government, fell to its lowest level in the last 14 years after October 7.
The Israeli shekel, which has been losing value for the last 13 days, has recorded the longest continuous decline in the last 40 years.
The Israeli economic newspaper Catalyst estimated that the war would cost Israel 17 billion dollars in total.
70% of high-tech companies face difficulties in the face of mobilization
It was stated that the high-tech sector, which is considered the dynamo of the country's economy, is also struggling due to the mobilization in the Israeli army.
According to the results of a survey conducted by the Israel Innovation Authority with 500 high-tech companies, 70 percent of the companies in the sector reported disruptions in their work.
It was pointed out that approximately 15-20 percent of the employees in the high-tech sector were conscripted, while the performance of those remaining in the workforce decreased due to childcare and other reasons.
It is stated that additional burdens such as the decrease in Israel's tourism revenues, the slowdown in economic activity, the mobilization of the army, and the expenditures made for internally displaced persons will further strain the public budget.