The Manufacturing PMI in Sri Lanka fell to 53.7 in December of 2018 from 54.3 in November, pointing to the slowest growth in factory activity since a contraction in April. Smaller increases were seen in production (51.5 from 54) and employment shrank (46.5 from 55), especially in manufacturing of textiles, wearing apparels, leather and
related activities. A significant decline in employment was experienced as some employees moved to seasonal jobs for better salaries. This partly impacted on decrease in
production. On the other hand, new orders (57 from 54) rose faster, namely food and beverages related with the continued festival season demand and stocks of purchases (60.5 from 57.5) increased due to intended accumulation of stocks to fulfil the future requirements anticipating supply disruptions due to upcoming Chinese new year festival. As a result, suppliers’ delivery time also lengthened (55.5 from 52.5). Manufacturing Pmi in Sri Lanka averaged 55.83 from 2015 until 2018, reaching an all time high of 67.30 in May of 2015 and a record low of 41.60 in April of 2016.
Manufacturing Pmi in Sri Lanka is expected to be 56.20 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Manufacturing Pmi in Sri Lanka to stand at 57.70 in 12 months time. In the long-term, the Sri Lanka Manufacturing PMI is projected to trend around 58.90 in 2020, according to our econometric models.