Pragnaa By JB

Pragnaa seeks to bridge the gap in the investment market with actionable insights

[Pragnaa By JB @pragnaabyjb]

Pragnaa seeks to bridge the gap in Sri Lanka's investment market by delivering unique, actionable insights rooted in high-quality, in-depth research, all crafted through a rigorous and integrity-centered process.

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[Pragnaa By JB @pragnaabyjb]

Fiscal surplus recorded in May 2026

https://t.co/YkS0HaYYNE

Key Takeaways
⚪ The fiscal balance recorded a surplus of LKR 92.3 billion in May 2026, marking a turnaround from the LKR 11.3 billion deficit recorded in April.

⚪ Total expenditure rose by 5.1% YoY to LKR 486.3 billion, while interest payments declined compared with the corresponding month of the previous year to LKR 176.1 billion.

⚪ Government revenue increased by 18.8% YoY to LKR 578.1 billion, primarily supported by strong tax revenue collections, which amounted to LKR 546.9 billion.

⚪ The primary balance recorded a surplus of LKR 268.4 billion, representing a 27.7% YoY increase in May and highlighting the continued strengthening of the Government’s underlying fiscal position.

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[Pragnaa By JB @pragnaabyjb]

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[Pragnaa By JB @pragnaabyjb]

Monthly Primary Surplus – May 2026

Cumulative Performance
Revenue increased by 30.7% YoY , supported by robust growth in tax collections.
The overall fiscal balance recorded a surplus of LKR 197.3 Bn, widening from the previous month.

The primary surplus strengthened further to LKR 1,131.1 Bn, reflecting continued fiscal consolidation.

Monthly Performance
Revenue expanded by 18.8% YoY, as strong growth in tax revenue more than offset the decline in non-tax revenue.
Expenditure increased by 5.1% YoY, reflecting higher recurrent spending alongside a decline in capital expenditure.

The fiscal balance recorded a surplus of LKR 92.3 Bn, as revenue grew at a faster pace than expenditure on a MoM basis.

#PragnaaByJB #InsightsByPragnaa #SriLankaEconomy #InvestmentInsights

[Pragnaa By JB @pragnaabyjb]

What’s happening in Sri Lanka’s external sector?

https://t.co/IKbaH3RgBm

Key Takeaways -

⚪ In May 2026, the current account recorded a deficit of USD 194.5 million, marking the second deficit after five consecutive surpluses.

⚪ The merchandise trade deficit more than doubled YoY in May, as import growth remained elevated at 45.4%, while export growth stood at 18.3% YoY.

⚪ The net services account declined by 36.8% YoY in May, mainly due to sharp contractions in manufacturing and construction services.

⚪ The terms of trade deteriorated by 3.2% YoY in May 2026, as cost of imports continued to rise faster than export prices.

⚪ Gross official reserves increased to USD 6.9 billion by end-May and CBSL recorded net foreign purchases of USD 70.5 Mn in June.

⚪ The financial account recorded net lending of USD 573.1 Mn in Q1 2026, with total net acquisition of financial assets of USD 604.3 Mn against net incurrence of liabilities of USD 31.2 Mn, compared with net borrowing of USD 349.1 Mn in Q4 2025.

#pragnaabyjb #insightsbypragnaa #SriLankInflation #EconomicUpdate #InvestmentInsights

[Pragnaa By JB @pragnaabyjb]

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[Pragnaa By JB @pragnaabyjb]

Monthly Primary Surplus – April 2026

Cumulative Performance

* Revenue increased by 34.7% YoY, supported by robust growth in tax collections.
* The overall fiscal balance recorded a surplus of LKR 105.0 Bn, narrowing marginally from the previous month.
* The primary surplus strengthened further to LKR 862.7 Bn, reflecting continued fiscal consolidation.

Monthly Performance

* Revenue expanded by 18.6% YoY, driven by strong growth in both tax and non-tax revenue.
* Expenditure increased by 13.5% YoY, reflecting higher capital spending alongside elevated recurrent expenditure.
* The fiscal deficit narrowed to LKR 11.4 Bn, as expenditure declined at a faster pace than revenue on a MoM basis.

#PragnaaByJB #InsightsByPragnaa #SriLankaEconomy #CCPI #EconomicUpdate #InflationTrends #InvestmentInsights

[Pragnaa By JB @pragnaabyjb]

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[Pragnaa By JB @pragnaabyjb]

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[Pragnaa By JB @pragnaabyjb]

Sri Lanka's current account recorded a deficit of USD 194.5 Mn , compared to a surplus of USD 171.3 Mn in May 2025. Although the Middle East conflict continued to weigh on the external sector through elevated import pressures, the current account deficit narrowed from the previous month, indicating an easing of these pressures.

The merchandise trade deficit widened by 104.8% YoY as import expenditure increased by 45.3% YoY, outpacing the 18.3% YoY growth in export earnings, which was primarily driven by industrial exports.

Vehicle imports recorded an uptick in May, following the moderation in the previous months, but remained well below the peak levels recorded in late 2025.

The trade balance reached a deficit of USD 824.7 Mn in May, while the services surplus of USD 143.2 Mn only partially offset the trade deficit.

Secondary income surplus of USD 835.5 Mn, the improvement was insufficient to offset the widened trade deficit and the moderation in the services surplus, leaving the current account in deficit.

#PragnaaByJB #InsightsByPragnaa #SriLankaEconomy #InvestmentInsights

[Pragnaa By JB @pragnaabyjb]

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[Pragnaa By JB @pragnaabyjb]

Sri Lanka Inflation – June 2026

Inflationary pressures strengthened further in June.

⚪ Headline Inflation: +6.8% YoY
⚪ Non-Food Inflation: +8.4% YoY
-Housing & Utilities: +6.3%
-Transport: +18.7%

⚪ Food Inflation: +3.6% YoY

Sector Highlights

⚪ YoY: Headline inflation accelerated further, driven primarily by stronger non-food price pressures, while food inflation also increased.
⚪ MoM: Both food and non-food prices rose compared to the previous month, contributing to the increase in overall inflation.

* Core Inflation (excl. Food & Energy): +4.0% YoY, indicating persistent underlying inflationary pressures.

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[Pragnaa By JB @pragnaabyjb]

Headline CCPI inflation accelerated further in June

https://t.co/IziKcoMEgM

Key Takeaways -

⚪Headline CCPI inflation accelerated to 6.8% YoY in June, driven by stronger food inflation (3.6% YoY) and elevated non-food inflation (8.4% YoY).

⚪Transport remained the largest contributor to non-food inflation (18.7% YoY), followed by Restaurants & Hotels (10.3% YoY).

⚪Housing & Utilities inflation eased marginally to 6.3% YoY but continued to exert significant upward pressure on headline inflation.

⚪ Monthly headline inflation rose to 2.1% MoM, supported by higher food inflation (4.5% MoM) and non-food inflation (1.0% MoM).

#pragnaabyjb #insightsbypragnaa #SriLankInflation #EconomicUpdate #InvestmentInsights

[Pragnaa By JB @pragnaabyjb]

Real GDP grew by 5.1% YoY in Q1 2026.

https://t.co/M2DLqr3WyV

Key Takeaways:
⚪ Sri Lanka's economic recovery strengthened in Q1 2026, with real GDP surpassing its previous peak level for the first time since the crisis.

⚪ Growth was broad-based, supported by industry (+7.2% YoY), services (+3.4% YoY), and agriculture (+1.1% YoY), resulting in an overall Gross Value Added (GVA) growth of 4.4% YoY.

⚪ Industrial activity remained the primary growth engine, supported by a strong expansion in construction (+16.3% YoY) and mining & quarrying (+19.5% YoY).

⚪ While productive sectors recorded a solid recovery, the stronger expansion in net taxes on products (+14.8% YoY) lifted headline GDP growth to 5.1% YoY, above the 4.4% YoY increase in GVA.

⚪ Services sector growth was driven by financial services (+12.8% YoY), transportation and storage (+5.4% YoY), and IT-related activities (+16.1% YoY), reflecting improving domestic economic activity.

⚪ Agricultural growth remained positive but relatively modest despite strong gains in oleaginous fruits and several plantation-related activities.

⚪ Looking ahead, growth is expected to remain positive in Q2 2026; however, rising inflationary pressures, tighter monetary conditions, and heightened global uncertainty may moderate the pace of expansion.

#pragnaabyjb #insightsbypragnaa #SriLankInflation #EconomicUpdate #InvestmentInsights

[Pragnaa By JB @pragnaabyjb]

Sri Lanka’s economy continued its recovery momentum in 1Q 2026, expanding by 5.1% YoY and surpassing its previous peak in real terms.

Growth was largely driven by industrial activity, with construction remaining a key contributor to overall expansion, followed by net taxes. Meanwhile, the Mining & Quarrying sector recorded the strongest YoY growth among major economic activities, expanding by 19.5% during the quarter.

The services sector also supported growth, led by financial services, transportation, and IT-related activities.

With real GDP now exceeding its previous high, Sri Lanka’s economic recovery continues to strengthen, reflecting improving domestic activity and business conditions.

Looking ahead, while growth is expected to remain positive, rising inflationary pressures, tighter monetary conditions, and heightened global uncertainty may moderate the pace of expansion in the coming quarters.

#pragnaabyjb #insightsbypragnaa #GDP #EconomicGrowth #SriLankaEconomy #EconomicUpdate #Industry #Construction #Recovery #SriLanka #Q12026

[Pragnaa By JB @pragnaabyjb]

The fiscal deficit narrowed in April 2026

https://t.co/I0UnMOnoUK

Key Takeaways -
⚪ The fiscal balance recorded a deficit of LKR 11.4 billion in April 2026, marking a moderation from the LKR 53.4 billion deficit registered in March.

⚪ Government revenue increased by 18.6% YoY to LKR 458.8 billion, primarily supported by strong tax revenue collections, which amounted to LKR 432.1 billion.

⚪ Total expenditure rose by 13.5% YoY to LKR 470.5 billion, with interest payments amounting to LKR 164.5 billion, reflecting a decline compared to the previous period.

⚪ The primary balance recorded a surplus of LKR 153.1 billion, representing a 13.2% YoY increase in April, highlighting the continued strengthening of the Government’s underlying fiscal position.

#pragnaabyjb #insightsbypragnaa #SriLankInflation #EconomicUpdate #InvestmentInsights

[Pragnaa By JB @pragnaabyjb]

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[Pragnaa By JB @pragnaabyjb]

Monthly Primary Surplus – March 2026

Cumulative Performance
⚪ Revenue increased by 40.5% YoY, supported by strong growth in tax collections.

⚪ The overall balance recorded a surplus of LKR 116.3 Bn, though it narrowed due to the weaker fiscal performance observed in March 2026.

⚪ The primary surplus strengthened further to LKR 709.6 Bn, reflecting continued fiscal consolidation.

Monthly Performance
⚪ Revenue expanded by 53.0% YoY, driven by robust growth in both tax and non-tax revenue.

⚪ Expenditure growth continued to accelerate, reflecting a notable increase in capital spending alongside elevated recurrent expenditure.

⚪ The month recorded a fiscal deficit of LKR 53.4 Bn, reversing the surplus recorded in February and weighing on the cumulative fiscal position.

#pragnaabyjb #insightbypragnaa #monthlyfiscalupdate #srilankaeconomy #publicfinance #macroinsights

[Pragnaa By JB @pragnaabyjb]

Has Sri Lanka's external sector started to loose momentum?

https://t.co/yaF9zGE8pS

Key Takeaways -
⚪ In April 2026, the current account recorded a deficit of USD 532.4 million, marking the first deficit after five consecutive surpluses.
⚪ The merchandise trade deficit widened by 92.6% YoY, as import growth remained elevated at 45.7%, while export growth stood at 10.9% YoY.

⚪ The net services account declined by 37.8% YoY in April, mainly due to sharp contractions in manufacturing and construction services.

⚪ The terms of trade deteriorated by 6.5% YoY in April 2026, reflecting weaker export price dynamics relative to imports.

⚪ Gross official reserves increased to USD 6.9 billion by end-May. Meanwhile, the CBSL remained a net seller of foreign exchange in the domestic market, following the end of a 22-month streak of net purchases in April.

⚪ The financial account recorded net lending of USD 349.1 Mn in Q4 2025, with total net incurrence of liabilities of USD 1,065.0 Mn against net acquisition of financial assets of USD 715.9 Mn, compared with net lending of USD 28.1 Mn in Q3 2025.

#pragnaabyjb #insightsbypragnaa #SriLankInflation #EconomicUpdate #InvestmentInsights

[Pragnaa By JB @pragnaabyjb]

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[Pragnaa By JB @pragnaabyjb]

Sri Lanka's External Sector – April 2026

Sri Lanka's current account recorded a deficit of 532.4 Mn USD, coming from a surplus of 176.6 USD Mn in April 2025, as import pressures weighed heavily on the trade balance. This was the first monthly deficit recorded since October 2025.

Merchandise trade deficit widened 92.6% YoY as imports surged 45.7% while exports grew a 10.9% YoY, driven by industrial exports.

Vehicle imports appear to be stabilizing at corrected levels, well below the late-2025 peak.

Trade balance hit -USD 1,153.4 Mn, as the services surplus of USD 229.2 Mn only partially offset the merchandise deficit.

Secondary income at USD 754.3 Mn remained the key buffer, but still wasn't enough to keep the current account in the positive territory.

#pragnaabyjb #insightsbypragnaa #SriLankaEconomy #CurrentAccount #Imports #Exports #EconomicUpdate #InvestmentInsights