Israel moved up three spots and has been the third-best performing economy in 2025 out of a list of 36 countries, according to an annual ranking compiled by The Economist.

The British magazine cited the outperformance of Israel’s stock market and a strong recovery of the economy following the two-year Israel-Hamas war in Gaza, which was halted in October with a ceasefire. Israel’s economy trailed only those of Portugal, which scored the top spot, and Ireland, which came in second place.

“Israel has continued its strong recovery from the chaos of 2023,” The Economist said, adding that Israel has been among the best performers when it comes to its local stock market.

“In the past year, the share price of the country’s most valuable listed company, Bank Leumi, has risen by around 70%,” The Economist added.

The Economist’s ranking for the “economy of the year” is based on an overall score evaluating five economic and financial performance indicators in a given year – core inflation, inflation breadth, Gross Domestic Product (GDP), employment and stock market performance.

Israel is also one of the best-performing equity markets in local currency terms in the 2025 ranking after Slovenia, the Czech Republic and South Korea.

According to a recent forecast by the Organisation for Economic Co-operation and Development (OECD), a group of countries with developed........

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