Sri Lanka’s external sector performance improved in September 2016 with a contraction in the trade deficit and continued growth in tourist earnings. The trade deficit in the month of September narrowed as a result of the increase in export earnings together with a reduction in import expenditure. Although worker’s remittances recorded a marginal decline, earnings from tourism increased during the month in comparison to that of September 2015. Furthermore, foreign investments at the CSE and government securities market as well as the long term loan inflows to the government supported to strengthen the financial account during September 2016.