Sri Lanka’s construction sector continued to expand in March 2026 but at a markedly slower pace, with the Purchasing Managers’ Index falling to 57.1 from 70.3 in February, the Central Bank reported.
The headline reading remained above the 50 threshold that separates expansion from contraction, but the sharp month-on-month deceleration pointed to mounting pressure on the sector. “Many respondents reported a challenging operating environment, mainly due to limited availability of fuel and raw materials, rising costs, and logistical bottlenecks stemming from the conflict in the Middle East,” the central bank said.
The New Orders Index fell to 67.2 from 70.3, with respondents reporting that project flows nonetheless remained robust. The Employment and Quantity of Purchases sub-indices both rose, indicating that firms continued planned hiring and procurement despite prevailing uncertainties.
The Quantity of Purchases Index expanded to 71.4 from 56.9, driven by higher construction activity. “Many respondents noted that amid expectations of further price increases, most firms sought to build up stocks, while suppliers tended to hold back on materials,” CBSL said. Suppliers’ delivery times lengthened notably, reflecting transportation-related delays.
The construction reading is a separate index from the manufacturing and services PMI, which the central bank publishes alongside it each month. Both surveys cover the same operating environment shaped by fuel availability, exchange-rate movements and supply-chain conditions linked to the Middle East conflict.
Source: EconomyNext.
