20/10/2023 10:55:00

Central Bank of Malta Business Dialogue Publication – Fourth edition of 2023

The latest business dialogue held between the Central Bank of Malta and non-financial corporations shows that in the third quarter of 2023, the net share of firms reporting better business conditions increased when compared to the previous quarter. It stood at 44%, up from 34% in the second quarter of the year.

Looking ahead, a net 47% of firms expected an improvement in short-term business activity, marginally higher than 46% in the preceding quarter.

In view of the improved supply chain conditions, cost pressures have eased considerably but remain elevated from a historical perspective. Indeed, a net 46% of contacts reported that input prices have increased in recent months, lower than 62% in the previous period.

When asked to comment on unit cost expectations over the next 12 months, most firms expected these to remain stable or increase further. However, the high level of global uncertainty prevented several others from passing a firm judgement.

The net share of firms reporting higher selling prices stood at 48% in the third quarter of the year, down from 53% in the previous quarter.

In the quarter under review, the net share of firms planning to invest more decreased to 50%, from 62% in the second quarter.

The net share of firms planning to increase their staff complement decreased by 16 percentage points, to a net 45%. Companies have continued to express concerns about labour and skill shortages and pressures to increase wages. Indeed, additional questions introduced during this round show that a large share of contacted firms expect wages this year and the next to rise by more than 5%.

The full publication is available here. The business dialogue survey can also be accessed in a new and interactive way through its dedicated dashboard.

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