Economic growth over the next three years is expected to remain strong, although slightly lower than 2017, according to the most recent forecast by the Central Bank of Malta.

The forecast showed an upward revision on growth when compared to the forecast released a few months ago. According to the Central Bank, growth was stronger in the sectors of private consumption and net exports.

The bank predicts that growth in the coming years will be supported by factors of supply and demand, including the continued impact of energy reforms, new investment projects, an increase in participation in the labour market and strong exports of services, which are the main stimuli for sustaining economic growth.

The Central Bank statement added that the labour market is expected to remain level, with the unemployment rate continuing to fall in 2017.

Annual inflation, based on the Harmonised Index of Consumer Prices (HICP), should increase from 0.9 per cent in 2016 to 1.2 per cent in 2017, partly because of increases in international fuel prices.

In terms of public finances, Government balance is expected to remain positive between 2017 and 2020. Meanwhile the proportion of debt to the Gross Domestic Product is expected to drop to just over 45 per cent.