Israel's economy thrives on tech boom as war costs mount

Israel's economy has rebounded strongly despite three years of multi-front war, with GDP growing 2.9% in 2025 and forecast to reach 4% in 2026, driven by a booming tech sector and record foreign investment. Unemployment stands at 2.8% and the shekel hit a three-decade high, but war costs have reached about $114.6bn and rising food prices worry voters ahead of October elections.