Dun & Bradstreet (NYSE:DNB) predicts that inflation will climb to 2.4% in 2002, and in 2003 decrease to 1.9%.

The estimates of the business information firm appear optimistic compared with forecasts by local macroeconomists. But the D&B estimates are high compared with its previous estimates, that inflation will reach 1.4% this year, and rise to 1.7% in 2003.

The D&B economists said that the economy is still under heavy negative pressure mainly from ongoing fighting in the region. They estimate that the government deficit will this year come to 4.2% of gross domestic product, compared with the 3% deficit target.

The economists are somewhat more optimistic for 2003, expecting 0.3% deficit only.

Reuven Kuvent, CEO of the local D&B branch, noted that despite negative pressure relating to the security situation, Israel's credit terms are good from an international perspective. He said that are no warnings have been made in respect of deals or loans.