RAMAT EFAL: Israel's economy grew 3.2 percent in 2018, lower than expected and its slowest pace since 2015, the Central Bureau of Statistics said in its preliminary estimate on Monday.

Growth this year was led by higher exports as well as gains in private and government spending and in investment in fixed assets, the bureau said, noting its estimate was based on data from the first 9-11 months of the year.

The economy's growth in 2018 was the slowest since a 2.6 percent rate in 2015, which was followed by 4.0 percent in 2016 and 3.5 percent in 2017. The slowdown was mainly due to a smaller gain in exports this year, even as consumer spending rose.

Still, Israel's growth in 2018 was above most other Western countries, including a 2.9 percent rate in the United States and an OECD average of 2.4 percent.

On a per capita basis, Israel's economy grew 1.2 percent due to an annual population growth of 2 percent, putting it well below that of both the United States (2.1 percent) and the OECD (1.9 percent).

The Bank of Israel had forecast a 2018 growth rate of 3.7 percent and projects a 3.6 percent pace in 2019.

Solid growth and rising prices led the central bank in late November to raise its benchmark interest rate to 0.25 percent from 0.1 percent, where it had stood since early 2015.

Economists do not expect a rapid tightening cycle in 2019, and incoming Bank of Israel Governor Amir Yaron, in his inaugural speech, stressed that while the main challenge for policymakers was to normalise interest rates, hikes should not be so aggressive as to risk halting growth.

In 2018, exports -- which account for some 30 percent of economic activity -- grew 4 percent, while private spending rose 4.1 percent. Investment in fixed assets increased 2.7 percent, with government spending up 4 percent and imports up 7.6 percent.

The bureau also revised third-quarter gross domestic product to a growth rate of an annualised 2.1 percent from an initial 2.3 percent estimate.