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Israel Post-War Economy to Grow Further in 2026 After 3.1% Gain in 2025

Israeli national flags flutter near office towers at a business park also housing high tech companies, at Ofer Park in Petah Tikva, Israel, Aug. 27, 2020. Photo: REUTERS/Ronen Zvulun

Israel‘s economy grew 3.1% in 2025, official data showed on Monday, rebounding from a 1% pace in 2024, with growth expected to accelerate sharply as long as a fragile Gaza ceasefire holds.

Growth last year was led by a 7.1% rise in investment and a 5.9% gain in exports, along with a modest uptick in consumer spending. Heavy state expenditure during the two-year Gaza war, particularly on defense, gave an added boost to the economy, economists noted.

“The economy is recovering,” said Yonie Fanning, chief strategist at Mizrahi Tefahot Bank. “The indications for the first quarter of 2026 are also positive – you see that in the trade balance data, etc. So, I think it … sets the basis for continued recovery.”

Israel‘s economy in 2025 outpaced an OECD average of 1.7% and 2% growth in the United States. It also was above the Bank of Israel‘s estimate of 2.8%. The central bank projects a 5.2% growth spurt this year.

“What you’re seeing now is excess demand coming after the war, which is coupled with an increase of supply also, for example, in real estate. And so, you see that in investment, and you should see that more going forward in 2026,” Fanning said.

Per capita growth was 1.7% in 2025.

In the fourth quarter, gross domestic product grew an annualized 4.0% from the prior quarter, powered by a 33% jump in exports following an October ceasefire between Israel and Palestinian terrorist group Hamas.

“This is relatively robust print, especially the business sector activity, impacted by a strong contribution from net exports,” said Leader Capital Markets Chief Economist Jonathan Katz.

A Reuters poll of economists had forecast an annualized 2.6% rate in the final three months of 2025.

Third-quarter GDP was revised to an annualized rise of 12.7% from a prior estimate of 11.1%.

The GDP data follow data published on Sunday showing Israel‘s annual inflation rate eased to 1.8% in January – its lowest level since June 2021 – from 2.6% in December, increasing pressure on the Bank of Israel to lower short-term interest rates next week for a third straight meeting.

Following the inflation data, “most people [in the market] don’t expect it to stay on hold,” Fanning said.

The shekel was flat at 3.09 per dollar, close to a 30-year peak hit earlier in February. Tel Aviv share indices gained as much as 0.3%.

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Olympic Store Worker Fired After Repeatedly Calling Out ‘Free Palestine’ to Israel Sports Fans

Milano Cortina 2026 Olympics – Bobsleigh – 2-man Heat 2 – Cortina Sliding Centre, Cortina d’Ampezzo, Italy – February 16, 2026. Adam Edelman of Israel and Menachem Chen of Israel react after their run. Photo: REUTERS/Athit Perawongmetha

An employee at an official store for the 2026 Milano Cortina Olympics in Italy has been fired after repeatedly called out “Free Palestine” to a group of Israeli sports fans, Olympic organizers said on Sunday in a statement to Reuters.

Milano Cortina Games organizers said in a statement they have taken action to maintain “a neutral, respectful, and welcoming environment” at the Olympics. They said the incident took place inside the official shop at the Cortina Sliding Center, the venue that is hosting bobsled, luge, and skeleton during the Winter Games this year. Israel competed in skeleton last week, among other sports, and its bobsled team had their first Olympic competition on Monday.

“It is not appropriate for Games staff or contractors to express personal political views while carrying out their duties or to direct such remarks at visitors,” Olympic organizers added about the incident. “Those involved were reassured, and the individual concerned was removed from the shift.”

The store employee was identified as Ali Mohamed Hassan, according to StopAntisemitism. On Friday, the watchdog organization shared on Instagram a video of the confrontation and said it took place earlier that same day.

The clip shows a woman inside an official Olympic retail store filming Hassan as she says, “What were you saying? Say it again.” Hassan is then heard repeatedly saying, “Free Palestine.”

“This is the Olympics. Israel is allowed to compete just like any other country; It’s not controversial; it’s not rage bait,” the woman who is filming tells Hassan in the clip, as he repeatedly says “Free Palestine.”

“OK, good for you, you did it, you freed Palestine, good job,” the woman tells Hassan before leaving the store.

 

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A post shared by StopAntisemitism (@stop_antisemitism)

“Police were called and a harassment investigation has been started, with possible charges forthcoming,” StopAntisemitism claimed in the caption for the video.

Israel has 10 athletes competing in the Milan Cortina Olympics. On Monday, AJ Edelman and Menachem Chen finished in last place out of 26 sleds in the two-man bobsled race. Edelman will be the pilot of his bobsled team when they compete in the four-man event later this week.

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Israeli Player Deni Avdija Makes History With NBA All-Star Game Debut

Jan 27, 2026; Washington, District of Columbia, USA; Portland Trail Blazers forward Deni Avdija (8) drives past Washington Wizards center Alex Sarr (20) during the second half at Capital One Arena. Photo: Reuters

Deni Avdija became the first-ever Israeli basketball player to play in the NBA All-Star Game on Sunday afternoon, wearing a No. 8 jersey which featured the flag of Israel.

The 25-year-old, who is a forward for the Portland Trail Blazers, scored five points to go along with four assists and a rebound over the course of two games for the “World” team.

There was a three-team format this year for the 2026 NBA All-Star Games at Intuit Dome in Los Angeles. Each team played each other in 12-minute games, and the two teams with the best record and the best point differential played against each other in a fourth “final” game. Aside from the “World” team starring Avdija, there was a “USA Stars” team of younger players and first time All-Stars, and the “USA Stripes” team that included many of the NBA’s most well-known names and All-Stars such as LeBron James and Stephen Curry.

Avdija scored five points in the first game of the tournament, which the “World” team lost. They played again in the third game and lost again, which took them out of the tournament. “USA Stars” and “USA Stripes” went head-to-head in the final game and “Stars” won 47-21.

Avdija arrived in Los Angles on Friday for the All-Star Game after playing back-to-back games on the road on Wednesday and Thursday for the Trail Blazers.

“It was a long weekend, I’m going to say that,” Avdija said at a post-game press conference on Sunday. “Great staff all around, great planning of the All-Star Weekend. It was hectic, but it was fun. I was really enjoying the experience. Especially when it’s your first time, you embrace everything a little better. But I hope I can be here for many years to come.”

Before the start of the All-Star Game, Los Angeles Lakers player and 22-time All-Star Lebron James was asked at a press conference about Avdija and replied, “I believe he is an All-Star. He’s playing exceptional basketball.”

James added that he hopes to visit Israel. “Hopefully, someday I can make it over there,” he said. “I’ve never been … but I’ve heard great things.”

Avdija competed in front of a star-studded audience that included American filmmaker Spike Lee sitting courtside in a pro-Palestinian outfit. Lee’s sweater had a black and white keffiyeh pattern and featured a Palestinian flag. Over the sweater, the “Malcolm X” director wore a crossbody bag with the same black and white pattern on the pouch and a strap that was adorned with the colors of the Palestinian flag and two inverted red triangles. The inverted red triangle has been used as a symbol to call for violence against Israelis and Jews, and as a symbol to glorify the Palestinian Islamist group Hamas’s terrorism.

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Owner of Ethiopian-Israeli Restaurant in Harlem Details ‘Unbearable’ Harassment, Death Threats That Forced Closure

Beejhy Barhany standing outside Tsion Cafe in Harlem. Photo: Provided

Ethiopian-Israeli chef and cookbook author Beejhy Barhany spoke with The Algemeiner about her recent decision to close her restaurant in New York because of consistent antisemitic harassment and even death threats that increased after she made the establishment kosher.

“The harassment has been going on for years,” said the owner of Tsion Cafe in Harlem. “It’s outside agitators, white supremacists, racist, antisemitism. I’ve been targeted by that … it kind of became unbearable. It became a burden and unsafe … to the point where somebody called and said, ‘We’re going to come and shoot you all.’” She detailed experiencing constant harassment through phone calls and her restaurant even being vandalized with swastikas.

The harassment “got worse” when Tsion Cafe, which served Ethiopian Israeli cuisine, became fully kosher after the Hamas-led terrorist attack in southern Israel on Oct. 7, 2023, Barhany said.

“After Oct. 7, we wanted to embrace our Jewishness, our proud heritage, and become fully kosher and vegan. The intention was that we are Jewish and we are here to celebrate our Jewishness. And that kind of amplified [the harassment] even more,” she noted.

“The intentions were very good,” Barhany continued. “We wanted to bring the diverse flavors of the Africa diaspora and have a dialogue and understanding — but apparently people took it in a different reaction. In a wrong understanding. That’s what happened, to the point where we said for the sake of safety and our mental health, I said, I cannot deal with this on a daily basis … because of the affiliation of being Israeli Jewish, all of the sudden, you are portrayed in a different way.”

Barhany was born in Ethiopia in a Jewish community and in 1983 moved to Israel, where she lived in a kibbutz and served in the Israel Defense Forces. She moved to New York in the early 2000s and opened Tsion Cafe in 2014.

Barhany announced on Feb. 12 that she was closing the restaurant. In a post announcing the closure on Instagram, she wrote: “To those who feel distant from us or disagree … we invite you to keep an open heart, to learn, and – if you’re willing – to engage in respectful conversation. Our hope is simple: that curiosity can replace assumptions, that learning can soften walls, and that, one day, we might even break bread together and build bridges.”

The decision to close Tsion Cafe was not easy, Barhany said. “We are invested in Harlem. Harlem is home,” she added. “We are part of the community. When we first opened, the community embraced us with warm welcoming, and we celebrated Ethiopian Jewish culture.”

Barhany contacted the New York City Police Department (NYPD) several times about the harassment targeting Tsion Cafe, but authorities did not provide much help, she told The Algemeiner. The restaurant owner said she was not looking to blame authorities for the continued harassment she faced but urged police to pay more attention to such complaints by business owners.

“Take it seriously – complaints like this,” she said. “Hopefully next time, a small business can complain about any harassment and people will take it seriously. As an immigrant, we are here to contribute, we provide and support the economy so they shouldn’t look at it and not pay attention, only [give attention] to big names. We all contribute to this society in our small way.”

Barhany said she hopes in the future to still serve Ethiopian Jewish cuisine through immersive cultural events and catering opportunities.

“What we need to do is really build bridges and highlight and amplify the different Jewish communities and celebrate our diversity,” she explained. “The Jewish world is a lot more delicious and diverse, a mosaic that is worth celebrating. And we should empower and celebrate one another. And I tried to do it in my own small part, through food, which is a universal language to engage with people, but yet people weaponize it and politicize it for no reason.”

“We’re still here in a different form to serve the community and nourish the community,” she added. “Through food we can help spread love, understanding and respect. And I hope to do that one bite at a time.”

Barhany is the founder of the Beta Israel of North America Cultural Foundation, a nonprofit organization dedicated to preserving the Ethiopian Jewish heritage.

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