Israel GDP Q1 2026 Analysis

Israel's Q1 2026 GDP contracted by -3.3% (annualized) following the start of the war with Iran, which was a downside surprise to consensus but an upside surprise to Goldman Sachs' expectations. Stronger-than-anticipated fixed investment has led to a revision of the 2026 GDP growth forecast to 2.0%.

Key Takeaways

• 1.Israel's GDP contracted by -3.3% annualized in Q1 2026, primarily due to the war against Iran which began in late February.
• 2.The contraction was less severe than Goldman Sachs' forecast of -5.0%, leading the firm to raise its full-year 2026 GDP forecast to +2.0%.
• 3.A surprising surge in industrial fixed investment partially offset declines in household consumption and residential building investment.

Table of Contents

• Bottom Line
• Key Figures
• Disclosure Appendix
• Reg AC
• Disclosures
• Global product; distributing entities
• General disclosures

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