Home > Economic Updates > MONTHLY ECONOMIC UPDATE - JULY 2019

MONTHLY ECONOMIC UPDATE - JULY 2019

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3 KEY INSIGHTS

  • CBSL and ADB Revises Down Sri Lanka’s Growth Forecast for 2019.

  • Sri Lanka Moves up to the Upper-Middle Income Category: World Bank.

  • China Records its Slowest Quarterly Growth in 27 Years.

 

Sri Lankan Economy

Trade Deficit Narrowed for the fifth Consecutive month in 2019: During May the external sector remained relatively stable supported by a contracting trade deficit. This reduction in the trade deficit was driven by the decline in import expenditure for a seventh straight month and the increase in export earnings. As per provisional data released by the Ministry of Development Strategies and International Trade, merchandise and services exports rose by 11.4% on a Y-o-Y basis during the first half of 2019. 

Sri Lanka Moves up to Upper-Middle Income category: Sri Lanka has moved up from lower-middle income category to upper-middle income category as per the new classification by the World Bank by reaching USD 4,060 GNI per capita as at 1st July 2019.

CBSL and ADB Revises Down Growth Forecast: Considering the economic impact of the terror attacks, the Central Bank of Sri Lanka (CBSL)has revised growth rates for 2019 from 4% to 3%. ADB has revised their forecasts for Sri Lanka’s growth from 3.6% to 3.5%.

Income Tax Collection Up During the first four months of 2019: The revenue generated from income tax increased by 9.6% during the first four months of 2019, reflecting the government’s effort to mobilize direct tax revenue, as announced by the Ministry of Finance.

Sri Lanka raises another USD 2 billion in Sovereign Bonds: The CBSL raised another sovereign bond in international capital markets in June after raising USD 2.4 billion in March 2019.

 

 

Global Economy

Developing Asia to Grow by 5.7% in 2019: ADB: GDP of the Asian region will grow by 5.7% in 2019 as unexpected strong growth in Central Asia offsets small downgrades for East, South and South East Asia in 2019, with growth slowing marginally to 5.6% in 2020.

China Recorded its Lowest Quarterly Growth for 27 years in Q2-2019: Chinese economy slowed to 6.2%, the weakest quarterly growth rate for 27 years, as the trade war with the US drags on.

Global Oil Prices Fell in June: The OPEC Reference Basket fell sharply in June by 10% on M-o-M, recording the second consecutive month of decline. Other crudes such as Dated Brent, WTI also fell in June compared to May. In July, expectations of weakening global demand for energy combined with supply rises in the US weighed in to push the price of crude lower.

 

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The Ceylon Chamber of Commerce

Economic Intelligence Unit

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