Malta’s economic growth story continues

Central Bank economic update shows that economic activity remained sustained in January

According to an analysis by the Central Bank, in January economic activity in Malta continued to grow close to the historical average, i.e. by around 4%. This is occurring at a time when, across Europe, large economies are facing either a slight decline in their gross domestic product or else stagnant levels.

The Central Bank report states that this overseas development has affected confidence among exporting firms, which has fallen below average. There has also been a decrease in the activity of the construction sector, as regards approved permits. On the other hand, industrial production remains very strong while the unemployment rate is at a historic minimum.

The Bank’s experts note that the inflation rate is well below what it was a year ago. Retail sales remained sustained and deposits with banks also increased.

In fact, according to figures published by the Central Bank, the labour market has continued to grow strongly. This comes as the number of newly hired people was around 3,000 more than those who lost their jobs. In contrast a year earlier there was a surplus of just under 3,500.

The report also notes how the rate of growth in debts to businesses has slightly decreased, while that towards households has increased. In contrast to businesses and families in other European countries, those in Malta are not facing higher burdens when it comes to interest rates. This is a key factor why consumption and investment are still going strong in Malta, while in Europe there is a decline or moderation in almost every economy.

The strength of domestic demand, as well as the increased competitiveness of local firms, is pushing upwards Malta’s growth and making it far greater than that of the rest of the euro area. 

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