29/10/2026 11:18:00

Central Bank of Malta issues October Economic Update

Growth in economic activity somewhat below its historic average

The latest indicators offer a mixed picture for economic activity in Malta. In September, the Bank's Business Conditions Index signalled that business conditions stood below their long-term average. Industrial production accelerated slightly in August while retail trade contracted in annual terms. Services production grew marginally in annual terms in July. Performance in the tourism sector remained strong in August.

Consumer sentiment continued to strengthen in September, underpinned by households' expectations of major purchases over the next 12 months.

Following a period of exceptionally strong dynamics, particularly on the supply side, the property market has moderated over the past few months. Approved permits for commercial buildings were higher on a month earlier, while residential permits decreased. Both were lower when compared with a year earlier. On the demand side, residential final deeds and promise-of-sale agreements signed in September were lower on the preceding month, and a year ago.

In August, the unemployment rate remained unchanged compared with July, at 3.4%. Households' unemployment expectations decreased in September, signalling expectations of lower unemployment in the months ahead.

Malta's inflation rate measured by the Harmonised Index of Consumer Prices (HICP) inflation rate picked up to 2.4% in September, from 2.0% in August. Nevertheless, inflation remained below that in the euro area due to unchanged energy prices in Malta. According to the Retail Price Index (RPI), inflation in September rose to 2.9%.

In August, the Consolidated Fund showed a smaller surplus compared with a year earlier, reflecting a stronger increase in government expenditure relative to government revenue.

In the year to August, growth in both residents' deposits and credit moderated compared with July.

The full Economic Update is available here.

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