Growth Gears Down: Sri Lanka’s November PMI Tells a Tale of Two Sectors

Updated: December 16, 2025 00:27

Image Source: Lanka Leader.lk

Sri Lanka’s services and manufacturing sectors posted slower expansion in November 2025, with the Services PMI at 50.5 and Manufacturing PMI at 55.5, both down from October. Despite the moderation, both sectors remain in growth territory, with positive business outlooks for the festive season.

Sri Lanka’s Purchasing Managers’ Index (PMI) for both services and manufacturing sectors posted lower readings in November 2025, signaling a slowdown in expansion compared to the previous month. While both sectors remain in growth territory, the pace of activity has moderated, reflecting evolving business dynamics and seasonal influences.

Key Highlights:

Services Sector Growth Slows Sharply: The Services PMI fell to 50.5 in November from 66 in October, marking the slowest pace of expansion since April 2023. This indicates a notable cooling in business activity, though the sector is still expanding marginally.
Manufacturing Sector Expansion Continues, But at a Reduced Pace: The Manufacturing PMI dropped to 55.5 in November from 61 in October, showing that production and new orders are still growing, but at a more moderate rate.
Employment and Backlogs Dip: Both sectors saw a reduction in employment growth and backlogs of work, suggesting that firms are adjusting to softer demand and ongoing recruitment challenges.
Positive Outlook for Year-End: Despite the slowdown, business expectations for the next three months remain upbeat, supported by favorable macroeconomic conditions and anticipated festive season demand.
Sub-Sector Variations: Wholesale, retail, and financial services led the services sector, while textiles and food & beverages were the main drivers in manufacturing.

Sectoral Insights:

The slowdown in both indices suggests that while Sri Lanka’s economy is still on a recovery path, the pace is easing. The services sector’s dip to near the expansion threshold (50) is particularly notable, reflecting softer demand and possible lingering effects from inflation and global economic headwinds. Meanwhile, manufacturing remains resilient, though growth is moderating as firms prepare for year-end seasonal cycles.

Source: Central Bank of Sri Lanka, Trading Economics, Daily Mirror

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