Annual growth in business activity remained broadly unchanged in November when compared with October and stood slightly above its historical average, the Central Bank of Malta reports in its December issue of the Economic Update.

It reports that the European Commission’s economic sentiment indicator for Malta rose and stood above its long-term average. Meanwhile, the employment expectations indicator increased in November and remained above its long-term average.

Price expectations decreased across sectors, bar in the services and construction sectors.

In October, both industrial production and retail trade rose on a year earlier. In September, annual growth in services production moderated slightly compared to August.

The unemployment rate remained low from a historical perspective. It was unchanged for the third consecutive month and below the rate from a year earlier.

In October residential permits were above their year-ago level. In November, both the number of residential promise-of-sale agreements and the number of final deeds were below those of a year earlier.

During the 12 months to October, annual growth in Maltese residents’ deposits, forming part of the broad monetary aggregate M3, accelerated. Growth in credit to Maltese residents, fell marginally when compared to the preceding month, reflecting slower growth in credit to general government.

In November, the annual inflation rate based on the Harmonised Index of Consumer Prices (HICP) fell to 2.1%. While overall inflation in Malta stood slightly below the euro area average, HICP inflation excluding food and energy stood at 2.0% – well below the corresponding rate in the euro area. According to the Retail Price Index (RPI), inflation in November declined to 1.3%, from 1.6% in October.

In October, the Consolidated Fund recorded a lower deficit compared with a year earlier, as a rise in government revenue outweighed an increase in government expenditure.

The full Economic Update is available here.