Economic update 11/2015

Abstract

Economic activity in Malta continued to expand robustly in the second quarter of 2015, with real gross domestic product (GDP) increasing by 5.2% on a year earlier. Growth was driven by domestic demand. Indicators for manufacturing and tourism point to further expansion in the third quarter of 2015. Buoyant economic activity is being reflected in the labour market, with employment expanding and the unemployment rate remaining at historically low levels. Price pressures are mildly increasing. The annual rate of inflation, based on the Harmonised Index of Consumer Prices (HICP), stood at 1.6% in October. Maltese residents’ deposits continued to expand at a rapid annual rate in September, while the annual rate of growth of credit to residents accelerated further. As regards fiscal developments, the general government deficit narrowed in the second quarter of 2015, while the deficit on the Consolidated Fund also decreased during the first nine months of the year. On the external side, the current account of the balance of payments remained in surplus in the second quarter of 2015.