Israel

September 2006 | Ratings Update

As the opening of the new parliamentary session (October 10th) approaches, we reiterate our view that early elections are a real possibility. The coalition government led by Ehud Olmert has been seriously discredited by perceived failures in the Lebanon conflict, as well as persistent allegations of corruption. At the very least, we expect to see a reshuffle, with Defence Minister and Labor Party leader Amir Peretz a likely casualty. However, given that his party's support is essential for the survival of the Kadima-led government, he will not be going far.

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