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External Sector Performance – August 2023

The merchandise trade deficit widened in August 2023 compared to a year ago led by higher decline in export earnings than the decline in import expenditure. However, both export earnings and import expenditure increased compared to July 2023. 

Both workers’ remittances and earnings from tourism recorded notable improvements in August 2023 compared to the previous year.

In August 2023, foreign investment in the government securities market recorded a net outflow, while foreign investment to the Colombo Stock Exchange recorded a net foreign inflow in August 2023.

CCPI based headline inflation recorded a significant decline in September 2023

Headline inflation, as measured by the year-on-year (Y-o-Y) change in the Colombo Consumer Price Index (CCPI, 2021=100) decreased to 1.3% in September 2023 from 4.0% in August 2023. The decline in the headline inflation is mostly in line with the projections envisaged by the Central Bank of Sri Lanka (CBSL) in July 2023.

The Food deflation (Y-o-Y) continued for the third consecutive month recording 5.2% in September 2023 from 4.8% in August 2023. Meanwhile, the Non-Food inflation (Y-o-Y) decreased further to 4.7% in September 2023 from 8.7% in August 2023. Monthly change of CCPI recorded at 0.88% in September 2023 due to the price increases of 0.18% observed in the items of Food category and 0.70% recorded in the items of Non-Food category. The core inflation (Y-o-Y), which reflects the underlying inflation in the economy, decreased to 1.9% in September 2023 from 4.6% in August 2023.



Release of “Sri Lanka Socio-Economic Data – 2023” Publication

“Sri Lanka Socio-Economic Data – 2023”, the annually published data folder of the Central Bank of Sri Lanka, is now available for public information. The current data folder is the 46th volume of the series.

This easy-to-carry booklet contains information categorised under 14 topics, namely, Country Profile; Key Economic Indicators; Country Comparisons; Socio Economic Conditions; Human Resources; National Accounts; Agriculture; Industry; Economic and Social Infrastructure; Prices and Wages; External Trade and Tourism; External Finance; Government Finance; and Money, Banking and Finance. As the data folder presents a wide range of socio-economic data of current interest in summary form, it will be a very useful reference material for policy makers, researchers, academics, professionals, students and the general public.

Sri Lanka Purchasing Managers’ Index (Construction) - August 2023

The construction industry continued to perform at a subdued level in August 2023, yet reaching towards the neutral threshold, recording a Total Activity Index value of 47.0. As per the respondents, firms tend to undercut prices to secure the limited available projects in a highly competitive tender bidding process.

The lack of new projects continued to have a severe adverse impact on the industry as reflected by the continuous decline in New Orders. Many respondents highlighted that the limited availability of local and foreign funded construction projects is still a major concern in the industry. In this background, firms laied off contract based employees to scale down operations as reflected by the continuous decline in Employment. Further, Quantity of Purchases continued to decline, yet at a slower rate during the month. In the meantime, Suppliers’ Delivery Time shortened during the month mainly due to reduced pressure on supplier capacity.

Conversion of Outstanding Credits of the Central Bank of Sri Lanka to the Government into Negotiable Debt Instruments with Specified Maturities under the Domestic Debt Optimisation Programme (DDO)

In accordance with Section 129(2) of the Central Bank of Sri Lanka Act, No. 16 of 2023, outstanding Provisional Advances from the Central Bank of Sri Lanka (CBSL) to the Government and outstanding Treasury bills purchased by the CBSL in the primary market were converted into ten (10) step-down fixed coupon* new Treasury bonds and to twelve (12) existing Treasury bills on 21 September 2023 as follows:

Governing Board of the Central Bank of Sri Lanka

The newly established Governing Board of the Central Bank of Sri Lanka, constituted under the provisions of the recently promulgated Central Bank Act No. 16 of 2023, was held today, the 21st of September 2023, at the Board Room of the Central Bank of Sri Lanka.

The Newly established Governing Board, succeeds the Monetary Board that functioned previously, under the provisions of the Monetary Law Act (MLA).

Today’s meeting of the new Governing Board of the Central Bank, was held, with the participation of the following members :-

  • a) Dr. Nandalal Weerasinghe, Governor of the Central Bank of Sri Lanka, as the Chairman,
  • b) Mr. Sanjeeva Jayawardena, President’s Counsel, who was previously, a member of the Monetary Board as well,
  • c) Mr. Nihal Fonseka, who also was previously, a member of the Monetary Board,
  • d) Dr. Ravi Ratnayake,
  • e) Mr. Anushka Wijesingha.

Governor Weerasinghe welcomed Mr. Sanjeeva Jayawardena PC, Mr. Nihal Fonseka, Dr. Ravi Ratnayake and Mr. Anushka Wijesingha, to the new Governing Board.