Sri Lanka’s construction sector continued its expansion in February 2026, with the Purchasing Managers’ Index (PMI) registering 70.3, according to Central Bank data. While down from January’s 75.0, the reading remains well above the 50-point threshold that separates expansion from contraction.
The Central Bank attributed the sustained growth to steady inflows of construction projects and favorable weather conditions during the month.
Employment and Orders Rising
The employment sub-index accelerated in February, with construction firms hiring at a faster pace in anticipation of growing project pipelines. New orders continued to expand as respondents reported access to a broader range of construction projects across the country.
Purchasing activity rose in line with higher construction volumes, while suppliers’ delivery times lengthened further. The extended lead times were attributed to sustained demand for building materials and import delays linked to the Chinese New Year period.
Expansion Before External Shocks
The February PMI data captures sector activity before the geopolitical disruptions of late February, which subsequently stressed global supply chains. The sequential decline from 75.0 to 70.3 suggests the expansion was already moderating from January’s elevated levels, though the sector remained firmly in growth territory.
Sri Lanka’s construction sector has benefited from renewed infrastructure spending and private investment as the economy recovers from the 2022 crisis, with both residential and commercial projects contributing to the sustained expansion.