Wednesday April 1, 2026 1:03 pm
Wednesday April 1, 2026 1:03 pm
ECONOMYNEXT – Sri Lanka’s construction sector activity continued to expand in February 2026, registering a value of 70.3, but at a slower rate than the previous month’s 75.0, according to a Purchasing Managers Index compiled by the central bank.
Firms reported favourable industry conditions in February, underpinned by steady inflows of construction projects and favourable weather, the central bank said.
This was before the US and Israel started bombing Iran on February 28, precipitating a regional conflict that placed stress on supply chains globally.
The Employment Index expanded at a higher rate, reflecting ongoing hiring in anticipation of increased project availability.
“The New Orders Index continued to expand during the month, with many respondents reporting increased availability of a broader range of construction projects,” the central bank said.
The Quantity of Purchases Index also expanded, in line with higher construction activities.
The Suppliers’ Delivery Time Index lengthened further during the month, reflecting continued construction demand and import-related delays associated with the Chinese New Year. (Colombo/Apr1/2026)
Wednesday April 1, 2026 5:23 pm
Wednesday April 1, 2026 5:23 pm
ECONOMYNEXT – Higher spending on fuel and vehicle imports led to a surged import bill in February 2026 and an expanded trade deficit, Central Bank data showed.
Merchandise imports in February jumped 25.2 percent to US$1.83 billion compared to US$1.46 billion recorded in the same month last year.
Import bill on personal and commercial vehicles in February skyrocketed to US$193.6 million from US$9.7 million a year earlier, while the outflow for fuel purchases jumped 43 percent to US$398 million from US$278.4 million a year earlier.
Total merchandise exports in February edged up 0.5 percent to US$1.06 billion, resulting in a trade gap of US$ 776.1 million, the data showed.
While the nation maintained a current account surplus for the fourth consecutive month in February, a deeper look at the numbers reveals a widening trade deficit and an import surge that could threaten long-term stability, analysts say.
Both remittances and foreign exchange revenue from tourism helped offset the trade deficit and contributed to the current account surplus.
Both remittances and tourism brought US$1.08 billion into Sri Lanka in February this year.
In the first two months of 2026, the merchandise trade deficit widened to US$ 1.4 billion, a significant jump from the US$ 1.1 billion recorded in 2025.
The surplus in the services account, however, declined by 16.7 percent year-on-year in February 2026, reflecting reduced inflows from major service categories including tourism earnings, alongside higher outflows related to overseas travel.
Foreign investments in the government securities market recorded a net inflow of US$ 53 million, while foreign investments in the Colombo Stock Exchange (CSE), including both primary and secondary market transactions, recorded a net outflow of US$ 30 million during the month of February 2026.
Analysts say if Middle Eastern tensions disrupt the flow of remittances, or if the higher imports of vehicles and luxury goods continue to outpace export growth, the current surplus could evaporate towards the end of this year. (Colombo/April 01/2026)
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Wednesday April 1, 2026 9:00 am
Wednesday April 1, 2026 9:00 am
ECONOMYNEXT — Sri Lanka’s Cabinet has approved a proposal to procure 300 MW of Battery Energy Storage Systems (BESS) to stabilize the growth of renewable energy, minister Nalinda Jayatissa said.
The Public Utilities Commission of Sri Lanka (PUCSL) moved the project timeline forward from 2032 to the 2028-2029 period, after identifying that peak demand is increasing two years faster than forecasted in the Long-Term Power Generation Plan.
To meet this requirement, the Cabinet cleared two procurement strategies; The larger portion of the plan involves the construction of 25 standalone battery energy storage systems.
Each unit will have a capacity of 10 MW/40 MWh, totaling 250 MW of the approved capacity.
These units will be directly connected to the medium-voltage distribution network of the Ceylon Electricity Board (CEB).
Under the approved proposal, these 25 projects will be developed on a Build, Own, and Operate (BOO) basis.
The private developers selected for these projects will maintain an operational period of 15 years, ensuring a long-term decentralized storage buffer for the national grid.
The second Cabinet decision targets a 50 MW capacity, to support existing renewable energy infrastructure.
Unlike the standalone units, this capacity will be procured by connecting battery systems to existing on-site solar power plants.
This 50 MW segment will be handled through a competitive bidding process.
The procurement will be managed by the Renewable Energy Procurement and Operations Supervision Division of National System Operator (Private) Limited, a successor entity of the CEB.
This move is intended to allow solar producers to store excess energy generated during the day for use during peak hours.
Jayatissa told reporters that the two-pronged approach is essential because solar power generation has already exceeded the integration limits set in the 2023-2042 long-term plan.
“If we can establish a battery storage system, we can promote renewable energy much more than this,” Jayatissa said.
“Just continuing to install solar panels won’t work unless we bring in these batteries to store energy everywhere.”
By separating the procurement into standalone distribution units and on-site solar integration, the government aims to increase the overall utilization of renewable energy while ensuring the grid can handle the volatility of solar power. (Colombo/Apr1/2026)
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Wednesday April 1, 2026 8:00 am
Wednesday April 1, 2026 8:00 am
ECONOMYNEXT – NEM Construction has been awarded a 1,228.25 million rupee (excluding VAT) contract to improve 4 sections of the Colombo-Galle-Hambantota-Wellawaya road in the Kalutara District, minister Nalinda Jayatissa said.
The repair involves a 9.91 kilometre stretch of the Sri Lanka’s A2 road.
8 bids were received for the project, Jayatissa told reporters.
“Following evaluation of these bids, the Cabinet approved the proposal to award the contract to M/s NEM Construction as the lowest responsive bidder.” (Colombo/Apr1/2026)
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Wednesday April 1, 2026 12:58 am
Wednesday April 1, 2026 12:58 am
ECONOMYNEXT – Russian Deputy Foreign Minister Andrey Rudenko is on a visit to Sri Lanka.
He is expected to participate in the 11th round of bilateral political consultations between Sri Lanka and the Russian Federation to be held on April 2.
Rudenko’s visit follows that of Russian Energy Deputy Minister Roman Marshavin’s visit to the island nation last week. (Colombo/Apr1/2026)
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Tuesday March 31, 2026 5:25 pm
Tuesday March 31, 2026 5:25 pm
ECONOMYNEXT – Sri Lanka’s Treasury bill yields soared across maturities at Wednesday’s auction, data from the Public Debt Management Office showed, with 32.49 billion rupees sold of an offered 90 billion.
The 3-month bill climbed 16 basis points to 7.80, with 40 billion rupees of bills offered and 10.08 billion rupees sold.
The 6-month bill was up 14 basis points at 8.09 percent, with 30 billion rupees of bills offered and 16.23 billion sold.
The 12-month yield was up 9 basis points at 8.41 percent, with 20 billion rupees offered and 6.17 billion rupees sold.
All three bills are available on tap. (Colombo/Mar25/2026)
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Tuesday March 31, 2026 5:00 pm
Tuesday March 31, 2026 5:00 pm
ECONOMYNEXT – Sri Lanka’s rupee closed at 315.60/80 to the US dollar in the spot next Tuesday, same as the previous day, dealers said, while bond yields closed up.
A bond maturing on 15.09.2027 closed at 8.90/9.10 percent, up from 8.75/9.00 percent.
A bond maturing on 01.05.2028 closed flat at 9.60/70 percent.
A bond maturing on 15.12.2029 closed at 9.95/10.00 percent, down from 9.99/10.00 percent.
A bond maturing on 15.03.2031 closed flat at 10.05/15 percent.
A bond maturing on 15.12.2032 closed at 10.60/85 percent, up from 10.50/70 percent.
A bond maturing on 01.06.2033 closed at 11.05/10 percent, up from 11.00/10 percent. (Colombo/Mar31/2026)
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