Jerusalem, 1 July, 2026 (TPS-IL) — The International Monetary Fund (IMF) today, Wednesday, published its annual report on the Israeli economy. The publication follows a discussion of the report held by the IMF Board of Directors on June 24, 2026. The report was written by a mission of IMF economists who visited Israel, led by Mr. Kotaro Ishi.
The IMF determined that elevated regional tensions have “tested Israel’s economic resilience,” and that the ongoing hostilities in the Middle East mean Israel’s defense expenditure is expected to remain high, and its labor supply will be constrained by mobilization of military reservists and reduced availability of non-Israeli workers.
“These pressures would compound longstanding structural challenges—such as persistently low labor-market participation among certain groups—and weigh on Israel’s medium-term economic outlook,”| said the IMF.