COLOMBO (NewsRadio); The Central Bank of Sri Lanka says expectations for business activities have improved further due to improvements in economic conditions in the country.
The CBSL said business activities are expected to improve in the next three months due to the festive season and expected expansion in economic conditions.
However, it said supply-side constraints, high direct and indirect taxes, cost of capital, and input prices remain detrimental to business operations.
Meanwhile, according to the Central Bank the Purchasing Managers’ Indices for both Manufacturing and Services activities decreased in the month of October.
Accordingly, Manufacturing PMI recorded an index value of 38.4 in October, with a decline of 4.2 index points from the previous month, driven by decreases recorded in all the sub-indices.
The CBSL said new orders and production have declined significantly, particularly in the manufacture of food and beverages and textiles and wearing apparel sectors, mainly due to demand-side impediments.
The export-oriented manufacturers, especially in the apparel sector catering to the North American and European markets, have highlighted that the decline in demand observed was mainly attributable to the fear of an economic slowdown in respective destinations.
However, suppliers’ delivery time was shortened in October compared to the previous month.
Meanwhile, the global manufacturing PMI has recorded a value of 49.4 in October, with a decrease of 0.4 index points from September.