While Israeli and Palestinian negotiators grope their way towards a US-sponsored peace meeting in Annapolis later this year, investors and economists are struggling with a different problem: how to justify the strength of the Israeli economy.

Last year’s botched war in Lebanon, the escalating conflict with Islamist militants in the Gaza Strip, the threat of Iran’s nuclear programme and the weakness of an unpopular and fractious government at home – nothing has so far managed to throw the economy off its high-speed track.