The Finance Ministry has issued a severe response after the Bank of Israel today raised interest rates by 0.6%, from 3.8% to 4.4%.

The ministry said that lowering lending rates was a central component in the integrated recovery plan for reviving economic growth. The plan was agreed on by Prime Minister Ariel Sharon, Finance Minister Silvan Shalom, and Bank of Israel Governor David Klein.

The ministry said that lowered interest rates were good for the economy, while the zigzag adopted by the governor is bad and will lead to deepening unemployment.

The government has fulfilled all its commitments in the economic recovery plan, while Klein has not, according to the ministry response.

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