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External Sector Performance - February 2017

Sri Lanka’s external sector remained subdued with a widening of the trade deficit, a moderation in tourist earnings and a modest growth in workers’ remittances in February 2017. A considerable widening in the trade deficit was observed in February with a decline in exports amidst increased imports mainly due to higher imports of fuel and rice. Earnings from tourism dipped with a marginal decline in tourist arrivals during the month, which could partly be attributed to the day time closure of the Bandaranayke International Airport (BIA) for resurfacing of the runway. The growth in workers’ remittances in February remained below the expected level. Further, the financial account was adversely affected by significant outflows from the government securities market during the month. However, some foreign investments were observed in the Colombo Stock Exchange (CSE) with inflows to both primary and secondary markets during the month.

Inflation in April 2017

Inflation, as measured by the change in the National Consumer Price Index (NCPI) (2013=100), which is compiled by the Department of Census and Statistics (DCS), decelerated to 8.4 per cent in April 2017 from 8.6 per cent in March 2017, on year-on-year basis. Both Food and Non-food categories contributed towards the year-on-year inflation in April 2017. The change in the NCPI measured on an annual average basis increased to 6.0 per cent in April 2017 from 5.6 per cent in March 2017.

Central Bank releases the publication 'A Guide to Financial Services in Sri Lanka'

The Central Bank released its new publication “A Guide to Financial Services in Sri Lanka” specifically compiled for the awareness of the general public. This publication was authored by Mr. P Samarasiri, Deputy Governor, in honor and gratitude to Mr. A S Jayawardena, the Governor November 1995 – June 2004, who proposed and guided Mr. Samarasiri to compile and release this publication first time in April 2002 in order to educate the general public on basic financial services in Sri Lanka. The publication contains basic information on financial institutions, their services, lists of various institutions licensed by the Central Bank, nature of regulation and supervision and safety of public transactions with financial institutions and is presented in a reader-friendly language. Sinhala and Tamil editions of the publication will be released in due course. The price of the publication is Rs. 50 and is available for purchase at publication sales counters of the Central Bank and Institute of Bankers of Sri Lanka.

SL Purchasing Managers’ Index Survey - April 2017

The Manufacturing Sector PMI, following the seasonal pattern, recorded 41.8 in April which is a decrease of 24.7 index points compared to March 2017. This indicates that the manufacturing activities contracted in April 2017, which is largely attributable to the decrease in the Production and New Orders sub-indices, following the significant increases observed in PMI for the month of March 2017. As highlighted by the survey respondents the new year holidays in April have also contributed to this seasonal decline in manufacturing activities. Further, all the sub-indices of PMI declined compared to the previous month. Moreover, all the sub-indices of PMI apart from Suppliers’ Delivery Time sub-index dropped below the neutral 50.0 threshold in April 2017. However, the expectation for activities indicates an improvement for the next three months.