An Israeli flag flutters outside the Bank of Israel building in Jerusalem August 7, 2013. Picture taken August 7, 2013. REUTERS/Ronen Zvulun/

Israel’s annual consumer price index (CPI) rose 4.4% in June, the most since November 2008, the Central Bureau of Statistics said on Friday as another rise in interest rates beckons.

A Reuters poll of analysts had projected 4.5%. CPI rose 0.4% in June from May, led by gains in transport, housing rentals and healthcare.

The Bank of Israel is widely expected to raise interest rates again at its next meeting on Aug. 22 after three straight increases since April that have taken the benchmark rate to 1.25% from 0.1%. Last week it raised the rate by a half-point.

“Inflation is accelerating broadly,” said Leader Capital Markets Chief Economist Jonathan Katz.

“With the Bank of Israel rather influenced by other central banks who are front-loading, it is fair to expect a 0.5% hike on August 22 and 0.5% on October 3 with rates reaching 2.75% in early 2023.”

While Israel’s inflation rate is around half that in the United States and Europe and its central bank says some price pressure stems from global supply issues and commodity prices, policymakers are concerned over a very low jobless rate of 3% that is pushing up wages.

Meanwhile, consumer demand remains robust, contributing to expected economic growth of 5% this year.

Economy Minister Orna Barbivai asked Israel’s top supermarket chains to delay for two weeks raising regulated bread prices that were set to jump 20% next week, according to a statement from the Prime Minister’s Office on Friday. The chains agreed, it said.

Barbivai also spoke with representatives of major bakeries to find a solution to higher raw materials costs without harming consumers.

Prime Minister Yair Lapid said he would enter into discussions with relevant authorities on Sunday.

The shekel gained to 3.48 per dollar from a rate of 3.49 after the inflation report.