• CCPI based headline inflation increased in December 2023

    Headline inflation, as measured by the year-on-year (Y-o-Y) change in the Colombo Consumer Price Index (CCPI, 2021=100) increased to 4.0% in December2023 from 3.4% in November 2023. This increase in the headline inflation is mostly in line with the projections envisaged by the Central Bank of Sri Lanka (CBSL) in November 2023. 

    After five months of continuous deflation, the Food category recorded inflation (Y-o-Y) of 0.3% in December 2023 from 3.6% deflation (Y-o-Y) recorded in November 2023. Meanwhile, the Non-Food inflation (Y-o-Y) declined to 5.8% in December 2023 from 6.8% in November 2023. Monthly change of CCPI recorded 0.89% in December 2023 due to the combined effect of price increases of 1.16% observed in items of Food category and price decreases of 0.27% observed in the items of Non-Food category. The core inflation (Y-o-Y), which reflects the underlying inflation in the economy, decreased to 0.6% in December 2023 from 0.8% in November 2023

  • SL Purchasing Managers’ Index (PMI) for Construction Industry – November 2023

    Construction PMI recorded a Total Activity Index value of 44.3 in November 2023, indicating a contraction in construction activities compared to last month. The respondents mentioned that the low level of new projects and the decline in work related to ongoing projects, as they are in the final stages, hampered the activity levels. 

    New Orders declined at a higher pace in November compared to the previous month. However, many respondents expect an acceleration in awarding of projects, especially government-funded projects, in the first half of the next year. Employment continued to contract as the companies tend to operate with minimum staff under the current industry situation. Further, Quantity of Purchases declined in line with the decrease in construction work. In the meantime, Suppliers’ Delivery Time remained lengthened during the month.

  • External Sector Performance – November 2023

    The trade deficit narrowed in November 2023, compared to a year earlier and October 2023, as a combined impact of an improvement in exports and a compression in imports. Exports recorded a year-on-year growth for the first time since September 2022.

    Monthly workers’ remittances continued to exceed US dollars 500 million and recorded a notable increase in November 2023 compared to the corresponding period in 2022.

    Tourist arrivals soared during the festive season, contributing to high earnings from tourism.

  • The Central Bank of Sri Lanka Releases the Financial Stability Review for the Year 2023

    The Financial Stability Review (FSR) of 2023 encapsulates the developments in the financial system, the risks and vulnerabilities identified thereof, and the policy measures taken by the Central Bank and other regulatory institutions in addressing such risks during the review period, which primarily covers data up to end September 2023. The electronic version of the publication can be accessed through the Central Bank website.

  • Provincial Gross Domestic Product (PGDP) - 2022

    Western, North Western and Central Provinces Continued to Anchor the Sri Lankan Economy

    Western province increased its share in nominal GDP to 43.4 per cent, continuously tightening the grip on the country’s economy during 2022. The strong presence of the Western province is visible in most of the economic activities, especially in Services and Industry sectors. Thereafter, North Western (11.2 per cent) and Central (10.0 per cent) provinces recorded second and third highest shares in the economy, respectively.

  • Sri Lanka Purchasing Managers’ Index (Manufacturing and Services) - November 2023

    Both Manufacturing and Services Purchasing Managers’ Indices recorded an increase in November 2023

    Manufacturing PMI increased to 57.0 on a month-on-month basis in November 2023, driven by the seasonal factors. The index exceeded the neutral threshold after March 2023, with a positive contribution from all the sub-indices.

    Services sector PMI recorded an index value of 59.4 in November 2023 indicating an accelerated expansion in the services activities. This was led by the increases observed in New Businesses, Business Activities, Employment and Expectations for Activity.

  • IMF Executive Board Completes the First Review Under the Extended Fund Facility Arrangement with Sri Lanka

    The IMF Board completed the first review under the 48-month Extended Fund Facility with Sri Lanka, providing the country with access to SDR 254 million (about US$337 million) to support its economic policies and reforms.

    Sri Lanka’s performance under the program was satisfactory. All but one performance criteria and all but one indicative targets were met at end-June. Most structural benchmarks due by end-October 2023 were either met or implemented with delay. Notably, the authorities published the Governance Diagnostic Report, making Sri Lanka the first country in Asia to undergo the IMF Governance Diagnostic exercise.

  • Governor of the Central Bank of Sri Lanka Dr. Nandalal Weerasinghe, co-chaired RCG Asia Meeting of FSB, held in Hong Kong SAR on 29 November 2023

    The Financial Stability Board (FSB) Regional Consultative Group for Asia (RCG Asia) met on 29 November 2023 in Hong Kong SAR and discussed recent financial market developments and their impact on the region, vulnerabilities arising from non-bank financial intermediation, the deepening of the sovereign-bank nexus in some emerging market and developing economies, and ways to promote effective regulation and supervision of crypto-asset related risks. Members shared their experiences of identifying, monitoring, and addressing these risks and welcomed FSB’s continued focus on enhancing the resilience of financial systems.

    The meeting was co-chaired by Mr. Eddie Yue, Chief Executive, Hong Kong Monetary Authority (HKMA) and the current member co-chair, and Dr. Nandalal Weerasinghe, the Governor of the Central Bank of Sri Lanka (CBSL) and the current Non- Member Co-chair of the RCG Asia. The Membership of RCG Asia comprises financial authorities from Australia, Brunei Darussalam, Cambodia, China, Hong Kong SAR, India, Indonesia, Japan, Korea, Malaysia, New Zealand, Pakistan, Philippines, Singapore, Sri Lanka, Thailand, and Vietnam.

  • CCPI based headline inflation increased in November 2023

    Headline inflation, as measured by the year-on-year (Y-o-Y) change in the Colombo Consumer Price Index (CCPI, 2021=100) increased to 1.5% in October 2023 from 1.3% in September 2023. This slight increase in the headline inflation is mostly in line with the projections envisaged by the Central Bank of Sri Lanka (CBSL) in October 2023.

  • External Sector Performance – October 2023

    Merchandise trade deficit widened in October 2023 due to relatively low export earnings driven by subdued garment exports and high import expenditure driven by fuel imports, compared to October 2022 as well as September 2023. 

    Workers’ remittances exceeded US dollars 500 million in October 2023, while earnings from tourism continued the notable improvement in October 2023, compared to a year ago. 

    Foreign investments in the government securities market continued to record a net outflow in October 2023, however, year-to-date net inflows continued to be positive.

    Gross Official Reserves amounted to US dollars 3.6 billion by end October 2023.

    The Sri Lanka rupee remained stable against the US dollar during the month of October 2023.

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