Sri Lanka Factory Activity Growth Slows

Sri Lanka’s Manufacturing PMI eased to 56.1 in January 2026 from 60.9 in December 2025, indicating that manufacturing activity continued to expand, albeit at a slower pace following the seasonal peak recorded in the previous month. All sub-indices remained above the neutral 50 threshold, signaling sustained growth in the sector. Expansion moderated for new orders (58.5 vs 63.8 in December) and production (57.5 vs 61.2). Employment growth also softened (51.5 versus 58.5), reflecting more moderate hiring conditions. Meanwhile, the stock of purchases accelerated (56.0 vs 53.7), largely due to inventory buildup ahead of the Chinese New Year holidays. Suppliers’ delivery time remained lengthened but eased somewhat (55.0 vs 62.5), consistent with slower growth in demand. Looking ahead, expectations for manufacturing activity over the next three months remain positive, supported by anticipated improvements in business conditions.

Sri Lanka’s Manufacturing PMI increased to 60.9 in December 2025 from 55.5 in November, indicating a sustained expansion in manufacturing activity. The improvement was largely driven by seasonal demand, despite weather-related disruptions experienced at the beginning of the month. Most sub-indices recorded growth during the period. New Orders rose sharply (63.8 versus 58.5), while Production increased (61.2 versus 50.0), mainly supported by strong activity in the food and beverages manufacturing sector. Employment also expanded (58.5 versus 55.5) and in line with increased production. The Stock of Purchases index remained in expansionary territory though it declined (53.7 versus 57.0). Meanwhile, Suppliers’ Delivery Time lengthened further (62.5 versus 57.7), in line with the strengthening of New Orders and Production. Looking ahead, expectations for manufacturing activity over the next three months remain positive, supported by anticipated improvements in overall economic conditions.

Sri Lanka’s Manufacturing PMI fell to 55.5 in November 2025 from 61.0 in October, signaling that manufacturing activity continued to expand but at a slower pace. All sub-indices contributed to growth, though at a slower rate: new orders eased to 58.5 from 64.0, supported primarily by the food and beverages and textiles and apparel sectors; production dropped sharply to 50.0 from 62.5; employment edged down slightly to 55.5 from 56.0; and stocks of purchases declined to 57.0 from 62.5. Suppliers’ delivery times remained extended at 57.7, marginally below October’s 58.0, reflecting continued demand for inputs. Looking ahead, despite recent adverse weather conditions, manufacturers remain cautiously optimistic about the next three months.