Economic activity in Malta remained broadly consistent with its long-term average, the Central Bank of Malta said in its August economic update.
The Bank's Business Conditions Index indicates a modest strengthening in business conditions in July, though it stands slightly below its historical average, the CBM said in a statement.
Retail activity grew at a more moderate rate in June, as did services production in May, while industrial production declined in annual terms and retained its volatile pattern. The tourism sector maintained its strong momentum in June.
Consumer sentiment declined in July but remained well above its historic average.
Unemployment expectations remained below their historical levels and continue to signal low unemployment in the next 12 months, it said.
Overall, supply and demand conditions in the property market remain strong. In July, approved permits for residential and commercial purposes decreased compared with a year earlier, but were higher than those in the preceding month, the CBM said.
On the demand side, final deeds and promise-of-sale agreements show similar movements to permits.
In June, the unemployment rate decreased slightly to 3.5% compared with May but stood above the rate recorded in the same month a year earlier.
It said that Malta's inflation rate rose marginally in July but stood well below that in the euro area. The annual inflation rate based on the Harmonised Index of Consumer Prices (HICP) stood at 2.1%, up from 2.0% in June, while HICP inflation excluding food and energy stood at 2.3%.
Across the euro area, both HICP inflation and HICP inflation excluding food and energy were higher than in Malta due to higher energy inflation. According to the Retail Price Index (RPI), inflation in July increased to 2.7%, the statement said.
In June, the Consolidated Fund reported a smaller deficit compared with a year earlier, reflecting stronger growth in government revenue.
The annual rate of change of Maltese residents' deposits and credit increased, compared with May, it said.