Tourism and Trade Fuel Sri Lanka’s Services Expansion

COLOMBO (News 1st); Sri Lanka’s economy showed signs of continued recovery in August 2025, with both the manufacturing and services sectors recording expansions, according to the latest Purchasing Managers’ Index (PMI) released by the Central Bank of Sri Lanka.

The PMI for Manufacturing stood at 55.2, indicating growth in the sector, although at a slower pace compared to July. 

All sub-indices remained above the neutral threshold, with notable contributions from the food and beverage manufacturing sector. 

Key indicators such as New Orders (56.5) and Production (54.0) showed positive movement, while Employment (54.0) and Stock of Purchases (53.5) also remained in expansion territory. However, Suppliers’ Delivery Time lengthened further, with delays in international shipping reported.

Expectations for manufacturing activities over the next three months remain optimistic, driven by anticipated seasonal demand toward the year-end.

Meanwhile, the PMI for Services reached 68.9, reflecting a strong expansion in business activity. 

Growth was supported by robust performance in wholesale and retail trade, personal services, and accommodation and food services, boosted by high tourist arrivals. 

Financial services also saw improvement due to increased lending activity.

New Businesses (66.8) and Employment (57.0) continued to rise, although Backlogs of Work declined slightly. Business expectations for the coming months remain positive, supported by favorable macroeconomic conditions and seasonal factors.

The global outlook also showed improvement, with countries like India, China, and the US reporting rising PMI trends, while the UK and Eurozone showed mixed signals.