The Consumer Price Index (CPI) measures how much prices in the economy have changed. Israel's Central Bureau of Statistics publishes it every month, around the 15th, for the previous month. In CPI-linked mortgage tracks, the outstanding balance is adjusted according to the change in the index.
An example
You took NIS 600,000 in a linked track. If the CPI rose by 0.3% this month, the principal grows by about NIS 1,800, even before the bank calculates the interest. If the index falls, the principal shrinks.
How much can it add up to?
With annual inflation of 2.5% over 20 years, linkage alone can increase the principal by tens of percent. This is why people are surprised to discover that after years of payments, their balance has hardly gone down.
Where are we today?
According to September 2026 data (published on 15.10.2026), the index fell by 0.5% that month, and inflation over the last 12 months stood at 1.6%, within the Bank of Israel's target range of 1%–3%. Current figures are on the rates and indices page (in Hebrew).
Which tracks are linked?
- Fixed, CPI-linked (ק"צ)
- Variable every 5 years, linked
Prime and fixed non-linked tracks are not linked to the CPI.
How to manage the risk
- Do not put the whole mortgage in linked tracks.
- Shorten the term of linked tracks, so less linkage accumulates.
- Compare total cost under an inflation assumption, not just the interest rate.