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Central Bank of Malta issues September Economic Update

The Bank’s Business Conditions Index for August indicates that annual growth in business activity is very close to its long-term average estimated since January 2000.

The European Commission’s Confidence Survey shows that economic sentiment in Malta edged down in August when compared with a month earlier, and stood below its long-term average, which is estimated since November 2002. When compared with July, sentiment deteriorated strongly in the retail sector and, to a lesser extent in industry and among consumers. By contrast, it improved in the services and construction sectors.

Additional survey information shows that compared to July, price expectations declined in industry and construction, but rose in the remaining sectors. The largest increase was recorded in the services sector.

The European Commission’s Uncertainty Indicator for Malta increased when compared with July, signalling higher uncertainty. This was mainly driven by developments in the services sector.

In July, industrial production increased in annual terms, following a contraction in the previous month. Meanwhile, the volume of retail trade increased in year-on-year terms.

The unemployment rate stood at 2.9% in July, unchanged from a month earlier, and the lowest rate on record.

Residential and commercial permits declined in July, relative to their yearago levels. In August, both the number of promise-of-sale agreements and final deeds of sale increased on a yearon-year basis, though these stood lower than in July.

The annual inflation rate based on the Harmonised Index of Consumer Prices (HICP) stood at 7.0% in August, up from 6.8% in the previous month. Inflation based on the Retail Price Index (RPI) also rose, reaching 7.0% in August from 6.8% a month earlier.

In July 2022, the deficit on the Consolidated Fund narrowed slightly when compared with a year earlier, as government expenditure decreased while government revenue increased marginally.

Annual growth in residents’ deposits remained strong in July, rising by 7.8%. Meanwhile, annual growth in credit to

Maltese residents rose marginally to 7.2%. By the end of the month, 622 facilities were approved and still outstanding in terms of the Malta Development Bank (MDB) COVID-19 Guarantee Scheme, corresponding to total sanctioned amounts of €482.6 million. By

July, three loan facilities were approved under a new MDB Subsidised Loans Scheme aimed at importers and wholesalers of wheat and animal feeds, with the total amount of sanctioned lending rising to €15.6 million.

In June, the MDB launched the Liquidity Support Guaranteed Scheme (LSGS) to provide additional liquidity support in response to the Ukraine crisis. This scheme consists of two measures: LSGS-A provides bank financing support to all undertakings affected by the crisis, while LSGS-B is specific to fuel and oil importers. No facilities were approved by July.

The full Economic

Update is available https://www.centralbankmalta.org/eco nomic-update

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2022-09-29T07:00:00.0000000Z

2022-09-29T07:00:00.0000000Z

https://maltaindependent.pressreader.com/article/281835762577632

Malta Independent