📈 Sri Lanka PMI Signals MoM Contraction in April Amid Seasonal Slowdown

The Central Bank of Sri Lanka (CBSL) reported a month-on-month contraction in both manufacturing and services sectors for April 2026, largely driven by post-festive seasonal impacts and fewer working days. • Manufacturing Sector Breakdown: The Manufacturing PMI fell to 42.6 in April from 66.7 in March. Sub-indices for New Orders, Production, Employment, and Stock of Purchases all declined. A drop in new orders was heavily felt in the food & beverage and textiles & apparel sectors due to fading festive demand. Production also dipped due to Sinhala and Tamil New Year holiday closures, while suppliers' delivery times lengthened amid Middle East logistical challenges. • Services Sector Breakdown: The Services PMI dropped to 46.7 in April from 59.5 in March, hit by holidays, a slowdown in tourist arrivals, and rising fuel prices. The sharpest contractions were seen in the transportation of goods and personal services, alongside notable downturns in wholesale/retail trade and accommodation. Furthermore, new businesses declined for the first time since April 2023. • Employment & Outlook: Employment contracted across both sectors as manufacturers released seasonal labor and service firms faced contract expirations and resignations. Despite the April dip, the three-month outlook remains generally positive and is expected to stabilize, though businesses remain cautious regarding ongoing geopolitical risks in the Middle East and global uncertainties.