Sri Lanka services see upturn in August, manufacturing fall slows: PMI | Sinhala News

Sri lanka News – Sri Lanka’s services sector began to recover in August with better availability of fuel while a fall in manufacturing slowed, according to a Purchasing Managers’ Index compiled by the central bank.

The manufacturing PMI was still below 50 at 49.6 percent though some sectors such as apparel were recovering.

“The rate of decline of manufacturing activities was softened with the improvements reported in Employment and Stock of Purchases compared to the previous month while Production and New Orders declined at a slower pace,” the central bank said.

“Further, the Suppliers’ Delivery Time was shortened with the improved mobility. Overall Production and New Orders declined marginally in August 2022 compared to July 2022.”

But there was an increase in production and new orders in the textile and apparel sector.

The manufacturing of food & beverage sector maintained Production and New Orders at the same level as of July 2022. Many respondents revealed that improved fuel availability on a month-on-month basis positively affected manufacturing activities.

Employment increased in August 2022, particularly in the manufacturing of textile and apparel sector which frequently suffered from a scarcity of employees.

Some respondents mentioned that slightly improved foreign exchange availability in the market allows them to open letters of credit to import materials.

The Services PMI returned to the growth territory in August 2022, with an index value of 51.7 after falling four months in a row.

“This expansion was driven by the increases observed in New Businesses, Business Activities, and Expectations for Activity,” the central bank said.

Improvements were seen in financial services, real estate, transportation, and other personal activities sub-sectors.

“With the increase in mobility amid the easing of fuel crisis Business Activities in the services sector increased in August following a continuous decline for four months in a row,” the central bank said.

“Accordingly, the business activities mainly related to financial services, other personal activities, real estate, and insurance sub-sectors showed improvements compared to the previous month.”

Low demand lead was also seen due to high inflation.

“As such, wholesale and retail trade sub-sector showed a major decline during the month,” the statement said.

“Employment continued to fall in August due to increasing resignations besides halt in new recruitments, non-renewal of existing employment contracts, and retirements.

Meanwhile, Backlogs of Work dropped during the month mainly with the ease of transportation difficulties faced by the staff. (Colombo/Sept16/2022)

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