Today: IMF air cover for rate cut. New int'l airport. Deal notes. TASE closes down.
Re: February 5, 2026 in Israel - and what it all means for investors at home and abroad.
Quick Takes:
Macro: The IMF hikes Israel’s 2026 growth forecast to 4.8% and greenlights ‘gradual’ interest rate cuts;
Transportation: The Government is set to approve Ziklag (Negev) as the site for Israel’s supplementary international airport.
Energy: Meshek Energy raises ₪250 million in a private placement.
Defense: Elbit Systems wins a ₪400 million contract; Gilat secures $10M order; Valurix pivots to defense with ex-General appointment.
Tech: Pagaya closes an oversized $800 million ABS deal; SENAI raises $6.2M.
Macro
The International Monetary Fund (IMF) mission concluded its visit to Jerusalem with a surprisingly optimistic forecast update, paired with a stern fiscal warning.
Citing a faster-than-expected post-war recovery, the IMF hiked its 2026 growth forecast for Israel from 3.9% to 4.8%. This aligns closely with Ministry of Finance and OECD estimates (approx. 5%), though remains slightly more conservative than the Bank of Israel (5.2%).
The Fund gave Governor Amir Yaron a clear nod, stating that with inflation cooling, a “gradual lowering of the interest rate toward neutral is appropriate.”
While the real economy rebounds, the balance sheet is bleeding. The IMF noted the deficit hit 6.8% in 2024, with Debt-to-GDP climbing to 68.6% (up from ~60% pre-war). Israel needs “fiscal consolidation” (read: spending cuts and tax hikes) to avoid stagnating at mediocre 3.5% growth in the medium term.
Our take: The IMF has effectively given the Bank of Israel ‘air cover’ to cut rates even if the US Fed holds steady. For investors, this is a bullish signal for government bonds and equities, but a sobering reminder that the “fiscal hole” will require painful extraction measures soon.
Energy
Meshek Energy (TASE:MSKE) completed a substantial capital raise. A private placement of ₪250 million led by institutional giants Menora Mivtachim and Clal Insurance (TASE:CLIS). Shares were allocated at 1,000 agorot, with ₪170 million flowing directly to the company coffers for development. Investors received options exercisable at 1,075 agorot; full exercise would swell the total capital injection to ₪530 million.
Defense
Elbit Systems (TASE:ESLT) has secured a ₪400 million ($110M) contract with the Ministry of Defense. Elbit will integrate advanced avionics, electronic warfare (EW), and DIRCM (laser-based missile defense) systems into the new fleet of CH-53K ‘Pere’ helicopters, replacing the aging Yasur fleet.
Gilat Satellite Networks (TASE:GILT) received a $10 million order to support a Low Earth Orbit (LEO) constellation. The deal involves supplying SSPA amplifiers for ground gateways. As satellite constellations move closer to earth (from GEO to LEO) to reduce latency, the complexity of ground-station tracking increases.
Veloryx (TASE:VRYX) (formerly Aquarius Engines) continues its aggressive pivot from green energy to defense. The company appointed Brig. Gen. (Res.) Zvika Haimovich, former Commander of Aerial Defense, to its board. This signals a clear intent to adapt their engine/generator tech for military applications.
Tech
Pagaya (NASDAQ:PGY) has completed its 85th securitization deal, an $800 million Asset-Backed Security (ABS) issuance for personal loans rated AAA. The deal was oversubscribed (2x demand), allowing Pagaya to upsize from the original $600 million target.
SENAI raised a $6.2 million Seed round led by 10D (with FS Ventures and 1948 Ventures). They focus on ‘Visual Intelligence’ (OVINT), using AI to analyze scattered social media video footage in real-time to provide actionable intel for defense and law enforcement agencies.
TASE snapshot for Thursday, Feb. 5, 2026
TA-35 Index (TASE:TA35): 🔴 -1.98%
TA-90 (TASE:TA90): 🔴 -1.30%
TA-125 (TASE:TA125): 🔴 -1.80%
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