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Israel cenbank held rates on housing price worries -minutes

JERUSALEM, Oct 9 (Reuters) - Worries of renewed housingprice increases and a belief that a weaker shekel should supportexports despite a weak global economy led the Bank of Israel tokeep short-term interest rates unchanged last month, minutes ofthe discussions showed.

The central bank left its benchmark interest rate

at 2.25 percent for a third straight month on Sept.24 - a decision supported by all six monetary policy members.

"It was agreed that the current effective exchange rateprovides a comfortable environment for continued exportactivity, though an additional slowdown in globalactivity is liable to make export development difficult," saidthe minutes, published on Tuesday.

Policymakers expressed concern that a decline in housingsupply, combined would higher demand in home sales and in newmortgages "will lead to renewed price increases" after housingprices had been stable for the past 12 months.

At the same time, a recent spike in inflation was deemed asa one-off due to supply factors such as higher energy and othercommodity prices and an increase in local taxes.

(Reporting by Steven Scheer)

((steven.scheer@thomsonreuters.com)(+972 2 632 2210)(ReutersMessaging: steven.scheer.thomsonreuters.com@reuters.net))

Keywords: ISRAEL RATES/MINUTES

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