The Central Bank has again downgraded its forecast for economic growth this year in its latest quarterly bulletin.

The bank predicts that the economy, as measured by gross domestic product, will expand by 0.8% this year.

This is down slightly from its forecast of 0.9% in April.

The Central Bank also said that its forecast for GNP - which excludes profits from the multi-nationals operating here - will fall by 0.3%.

It had earlier predicted a flat GNP performance.

The bank said that exports continued to perform well in the first quarter of 2011, but it expects some moderation in demand during the rest of the year. It predicts that exports will grow by 6.4% this year and by 6.2% in 2010.

Demand in the domestic economy remains weak, with consumer spending expected to decline as people see a fall in their disposal incomes and fragile consumer confidence.

Employment levels are also expected to continue to fall this year and the Central Bank says that the labour market conditions remain weak.

Higher insurance premiums, more expensive mortgage interest rates and higher oil prices are also affecting inflation levels here.