29/09/2025 12:26:00

Central Bank of Malta issues September Economic Update

Business activity around average, amid elevated uncertainty

The Bank's Business Conditions Index shows that in August, annual growth in business activity rose slightly to its historical average. The Bank's Economic Policy Uncertainty Index, an indicator that monitors economic policy uncertainty by synthesising information gleaned from Maltese news portals, declined but continued to stand above its historical average.

In August, the European Commission's Economic Sentiment Indicator rose on a month earlier, while the Employment Expectations Indicator fell. While the former stood above its long-term average, the latter stood below it.

In July, industrial production and retail trade rose at a slower pace in annual terms. In June, services production contracted further on a year earlier.

The unemployment rate continued to stand at a historical low of 2.6%.

Permits for residential buildings in July increased from their year-ago level. In August, the number of residential promise-of-sale agreements and final deeds of sale also increased on a year earlier.

In July, the annual rate of change in Maltese residents' deposits moderated slightly when compared with June, while credit granted by monetary and financial institutions in Malta increased at a faster pace.

In August, the annual inflation rate based on the Harmonised Index of Consumer Prices (HICP) stood at 2.7%, higher when compared with the previous month. HICP inflation excluding food and energy also stood at 2.7%. Both indices stood above the euro area average. According to the Retail Price Index (RPI), inflation rose to 2.7% in August from 2.4% in July.

In July, the Consolidated Fund registered a deficit compared with a surplus a year earlier, due to a decline in government revenue and a strong rise in government expenditure.

The full Economic Update is available here.

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