Israel's economy slumps 19.4% in the fourth quarter as war takes a toll

Israel’s output contracted sharply in the final three months of 2023, falling for the first time in nearly two years due to the war with Hamas. Gross domestic product (GDP) plunged 19.4% on an annualized basis compared with the previous quarter. The decline was driven by a drop in private consumption, fixed investment, and exports. Analysts predict a weak GDP growth for 2024 as a whole. The war in Gaza is expected to cost Israel a significant amount and has led to a credit rating downgrade. The conflict’s impact on the economy is testing the strength of Israel’s tech sector.