The annual conference of the International Monetary Fund, the IMF, will open this week in Bangkok, capital of Thailand, with the participation of bank executives and economists from around the world, led by Kevin Maxwell Warsh, chairman of the US Federal Reserve. The head of the fund is Kristalina Georgieva of Bulgaria.
The permanent location of the conference is in Washington, but once every two years it moves to a world capital. The Israeli financial delegation will have a prominent presence this year.
Prominent Israeli delegation amidst global banking leaders
The most prominent Israeli representative is Bank of Israel Governor Prof. Amir Yaron, who is held in high regard globally. Despite his criticism of the budget, just recently, at the Jackson Hole conference in the US last month, he spoke in defense of the Israeli economy, appeared before foreign investors, and enumerated the advantages of investing in Israel.
Alongside him, the CEOs of the major banks will participate, including Bank Leumi CEO Hanan Friedman, Bank Hapoalim CEO Yadin Antebi, Israel Discount Bank CEO Avi Levi, and Chairman of the Board Danny Yamin. Also participating will be Mizrahi-Tefahot Bank CEO Moshe Lari and First International Bank of Israel CEO Eli Cohen.
The bank executives have prepared presentations that include a description of the Israeli economy and positive data regarding the market. These include, among other things, growth figures, high-tech sector exports, low unemployment rates, and vast foreign currency reserves.
However, it is not improbable that two additional topics will be on the agenda from the Israeli perspective: The upcoming Knesset elections and their impact on the Israeli economy.
An equally important topic is the sanctions being considered by countries in Europe, led by Britain, on Israeli banks that maintain ties with businesses operating beyond the Green Line.
In addition, bank leaders will take advantage of the opportunity for meetings with colleagues from the US and Europe to maintain credit agreements, and update them if necessary.
Global economic tensions and interest rate outlook
Yet with all due respect to Israel, panels concerning all countries of the world, led by the US, will take place during the conference. At the top of the agenda will be tensions with Iran, the Houthis, and Saudi Arabia, and their impact on oil prices and inflation. Extensive discussions will be dedicated to the issue of AI and its impact on energy demand.
What will be directly affected by the insights in these areas is US interest rate policy, which is derived among other things from yields on long-term US bonds, which are approaching a level of 5.5% annually. And the interest rate in the US will naturally also affect its level in other countries, including Israel.
Therefore, it is likely that following this conference, the probability will increase that in the upcoming interest rate decision on October 21, the interest rate will remain unchanged.