Bank of America-Merrill Lynch said last week that Israel's economic growth will be flat this year as the economy bounces back from a recession.

In a report published last week, Merrill Lynch raised its economic growth forecast from a contraction of 2%. The report said that the economy will probably expand 2.5% in 2010, up from a previous forecast of 2.1%.

Mr. Turker Hamzaoglu, a London-based economist at Merrill Lynch, noted in the report that "The Israeli economy not only has proved its resilience to the global recession but also has showed that it has strong muscle to bounce back”.

The Israeli Central Bureau of Statistics (CBS) said on August 16 that Israel's economy grew at an annualized rate of 1% in the second quarter of 2009 as exports and consumer spending increased. The CBS also noted that the economy contracted at a revised rate of 3.2% in the first quarter, less than the 3.7% it had forecasted earlier.