From a monetary policy perspective, on the other hand, problems in the medium term would typically be cause for immediate action. This asymmetry in policy reactions might be at the core of the institutional frictions facing the Economic and Monetary Union since the global financial crisis.
All Israel’s governments and the parliaments which approved the budgets in the last decade answered in the affirmative: the share of public-sector expenditure in GDP in Israel is too high, and reducing it is the best way to cut the deficit and the huge government debt.