relatively healthy labor market, which is quite different from what we see in both the us and europe. this growth is taking place without any pressure on wages. in both the business sector and the public services sector, wages are quite stable, which says that the labor market has not yet exhausted its growth potential, and is thereby not leading to inflationary pressure. as such, overall, developments in the market do not provide a clear picture, and we can even say that they provide more of an impressionist picture, and that anyone can interpret it any way he wishes. the data that we saw, in any case, did not lead to a clear conclusion that made it necessary to change policy in either direction. the third objective of the bank of israel is to support financial stability. in this context, it is of particular importance that we look at the level of leverage in the economy, and at asset prices, and ask ourselves whether we see any risks from this direction. in many places, including at this conference, and certainly at many central banks, people deal with the very complex issue of the low interest rate environment, both in israel and abroad, and with the distortions that may be created by such a low interest rate level. this is also an issue that we discuss. when looking at early indicators of financial instability, we need to look not only at the levels, but also at the growth rates – of both prices and of levels of leverage. and here, the picture that we have in israel is quite different from almost every other economy that we know. the overall burden of debt in the economy – the total debt of the public sector, the business sector, and households, relative to gdp – has been declining very slowly over the bis central bankers ’ speeches past few years. the government is adopting a long - term policy of reducing the debt burden, and we can see that between 2007 and 2013, the burden of debt of the public sector declined by 7. 5 percentage points. in contrast, in most advanced economies, we saw very rapid growth in the public sector debt – 29 percentage points in europe, and 40 percentage points in the us. in terms of the level, israel ’ s debt - to - gdp ratio stands at 67 percent, a marked improvement compared to the past, even from the standpoint of relative position. if we look at the business sector during the same years, we can see that in israel, there was a decline of 25 percentage points in the ratio of business sector

the weather in both the us and europe. the americans and the europeans did not see this as a sign of future moderation, but as a one - time development, and the update of the forecasts reflected only the surprise of the first quarter, and not expectations of moderation later on. we must assume that this development also had an impact on the israeli economy. beyond that, the first quarter data that were published are initial data, and we know well that these data go through significant revisions for the most part. we must therefore relate to them as part of a whole of other indicators that we look at, some of which were negative and some positive. the composite state of the economy index did not change in recent months, which is certainly an indicator that points to a slowdown in the rate of growth. goods exports ( excluding ships, planes and diamonds, at current prices ) have not grown for a number of quarters, and we see that in the first four months of the year, there is even a decline. exports are certainly affected by the developments abroad that i outlined, and also, obviously, by the exchange rate. it should be emphasized that in this context, i am referring to the level of the exchange rate and not the change in it. basically, since the beginning of the year, there has not been a material change in the effective exchange rate, following the appreciation that took place mainly in the first half of 2013. however, the level of the exchange rate has a delayed effect on exports to a certain extent, and it is therefore possible that exports are currently reacting to the appreciation that took place earlier. among the positive indicators, bank hapoalim ’ s consumer confidence index is in the positive area, and is even increasing. services exports, which account for about one - third of exports, are growing at a respectable pace, and the main component that is growing is obviously business services, and within that, software services. these industries characteristically better absorb the strengthening of the shekel, and developments abroad also apparently have less of an impact on the consumption of services that our industries excel at producing. health tax receipts, which provide an indication of total wages in the economy, are increasing. basically, all of the data from the labor market indicate continued growth, although we must remember that they are provided with some delay. we see continued increase in the participation rate, decline in the unemployment rate, and growth in the number of employed persons. all of these data indicate a