30/03/2026 09:33:00

Central Bank of Malta issues March Economic Update

Economic sentiment remains elevated

The Bank's Business Conditions Index indicates that in February, annual growth in business activity edged up slightly from the level in the preceding month and remained above its historical average.

In February, the European Commission's Economic Sentiment Indicator declined from the historic high reached a month earlier but remained elevated. Meanwhile, the Employment Expectations Indicator fell and stood below its long-term average. The Economic Uncertainty Indicator (EUI) turned positive, indicating higher uncertainty surrounding financial and business decisions.

In January, industrial production increased in year-on-year terms, after declining in the preceding month, while year-on-year growth in retail trade was unchanged. Services output fell over the 12 months to December after showing no growth a month earlier.

The unemployment rate stood at 3.4% in January - 0.2 percentage point higher than the rate recorded in December.

In January, permits for residential buildings decreased from their year-ago level. In February, both the number of residential promise-of-sale agreements and the number of final deeds of sale increased on a year earlier.

The annual inflation rate based on the Harmonised Index of Consumer Prices (HICP) stood at 2.3% in February, unchanged from the previous month. HICP inflation excluding food and energy stood at 2.2%. While overall HICP inflation was above that in the euro area, HICP inflation excluding food and energy in Malta stood below it. According to the Retail Price Index (RPI), inflation in February remained unchanged at 2.5%.

In January, the Consolidated Fund registered a lower deficit compared to the shortfall recorded a year earlier, as an increase in government revenue outweighed a rise in government expenditure.

The annual rate of change of Maltese residents' deposits and credit, moderated in January compared with December.

The full Economic Update is available here.

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