The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF’s Executive Board. Based on the findings so far, staff will prepare a report that, subject to management approval, will be presented to the IMF's Executive Board for discussion and decision.

• The 2018 budget should continue fiscal consolidation, supported by the new Inland Revenue Act. 
• Monetary policy should remain vigilant to pressures on inflation and credit growth.
• Upholding the reform momentum is key to addressing vulnerabilities and sustaining inclusive growth.

After constructive discussions with the authorities in Colombo and during the Annual Meetings, an IMF staff team issued the following statement in Washington DC: 

The Manufacturing Sector PMI recorded 59.0 in September which is an increase of 4.6 index points compared to August 2017. This indicates that the Manufacturing activties continued to expand in September 2017 at a higher rate compared to August 2017. This expansion was mainly driven by the increase in the Employment sub-index which recovered from the contraction observed in the previous month with the recruitment of new employees. The production and new orders sub-indices expanded at higher rates in September. The Stock of purchases sub-index increased at a slower rate due to the excess stocks level observed in the previous month. Suppliers’ Delivery Time lengthened, albeit at a slower rate compared to previous month. Overall, all the sub-indices of PMI recorded values above the neutral 50.0 threshold signalling an overall expansion in September 2017. Moreover, the Expectation for activities remain positive for the next three months.