News & market updates

Sri Lanka's current account swung to a $245m deficit in 1H 2026 from a $1.4bn surplus a year earlier as the merchandise trade deficit widened 67% to $5.49bn (exports $6.9bn, imports $12.4bn). Higher fuel imports (1H fuel bill $3.17bn, +58.8% YoY), a weaker services surplus and Middle East-related import pressures drove the deterioration; gross official reserves were $6.5bn and the rupee was 7.8% weaker YTD.

Government warns AI is changing the economics of Sri Lanka's software exports and urged the industry to shift from selling engineering hours to products, intellectual property and higher-value services to meet a $5 billion digital export target by 2030, following a validation workshop on a proposed roadmap.

Sri Lanka's Construction PMI (Total Activity Index) rose to 60 in June from 59.1 in May, indicating expansion; the Employment Index increased to 61.4. Firms cited ongoing project execution supporting activity but flagged shortages of skilled workers and key raw materials (notably bitumen) and supply disruptions as constraints.

Union Bank of Colombo (UBC.N0000) reported 1H 2026 PBT of Rs. 881 million, up 84% y/y, and PAT of Rs. 587 million, up 134%; gross income rose 19% to Rs. 10,139m and total assets grew 15% to Rs. 199,283m.

The Rs. 250 billion Treasury Bond auction was fully taken up, sparking a secondary-market rally that drove yields lower across the curve. Short-term T-Bill yields fell for a third week (91-day to 9.86%), foreign holdings rose by Rs.6.44bn to Rs.188.82bn and the rupee strengthened to Rs.335.65/335.80.

Dialog Axiata PLC has appointed Tarun Kumar (National Head, Sales & Distribution, Bharti Airtel) as a Non-Independent, Non-Executive Director effective 31 July 2026. Bharti Airtel holds a 10.36% stake in Dialog; Axiata Investments (Labuan) Ltd holds 73.75%.

Sri Lanka's monthly current account deficit widened to $149mn in June 2026 (third consecutive monthly deficit), leaving a H1 cumulative deficit of $245mn versus a surplus in H1 2025. The merchandise trade gap widened as import expenditure (fuel imports +40.2% YoY) outpaced export growth, tourist earnings fell and remittances rose; official reserves were $6.5bn and the rupee had depreciated 7.8% YTD by end-July.

Headline inflation rose to 7.3% in July 2026 from 6.8% in June, breaching the Central Bank's 7% upper target. The CBSL said higher housing rents and food inflation, and a c.47% fuel price rise after Middle East supply disruption, drove the increase; the central bank last month kept the policy rate unchanged and expects inflation to remain above target in the near term.

Indiya at City of Dreams Sri Lanka will host Indian Accent Mumbai and Ekaa for an exclusive two-night chef's tasting on Aug 7-8, 2026. The event features guest chefs Rijul Gulati and Niyati Rao presenting specially curated vegetarian and non-vegetarian tasting menus.

CIPM Sri Lanka won two national titles at the National Business Excellence Awards 2026-Winner, Education Sector and Winner, Medium Category-at the ceremony held on 29 July 2026, organized by the National Chamber of Commerce of Sri Lanka.

Sunshine Holdings PLC has launched a Group-wide data, digital and AI transformation called 'Reimagining the Future: Sunshine's Digital Evolution Journey' to become more data-driven and AI-ready. The programme will partner with Beyond: Putting Data to Work for organisational readiness and Ernst & Young Sri Lanka for enterprise technology and ERP design.

Colombo International Airport Hotel's Little Japan will host a 250+ member Japanese delegation arriving in late August for a multi-day tour across Sri Lanka, the largest privately organised Japanese visitor group to the country. The visit is organised by Dr. Ruwan Perera to boost tourism, trade and investment ties.

SLT‑MOBITEL's innovation arm The Embryo's SenseGrid was named National 1st Runner‑up in the Best Innovative Product in Manufacturing category at the SLASSCOM National Ingenuity Awards 2026. SenseGrid is an Industrial IoT solution offering sensor-based monitoring, real-time visibility and AI analytics and is deployed with partners such as DHL and DSI.

John Keells CG Auto (part of John Keells) opened BYD's ninth Sri Lanka showroom in Batticaloa, expanding NEV retail coverage with plans for service and spare-parts facilities; Keells has deployed 46 fast chargers and, with GreenEV, expanded public charger access to 129 locations island-wide.

JADE, the LAUGFS Group’s Chinese restaurant brand, opened its fourth outlet at No. 326, Dehiwala Road, Boralesgamuwa (Bellanwila), seating ~90 and offering BYOB plus delivery via PickMe Food and Uber Eats; senior LAUGFS leadership attended and further expansion is planned.

AIA Insurance Lanka expanded its annual Poson Safety Programme, saving six lives and providing services to hundreds of thousands of pilgrims, operating free pilgrimage and shuttle trains, deploying 530+ lifeguards, offering health screenings and running environmental clean-ups.

Hemas Holdings' Diva Fresh has relaunched an improved washing powder with Stain Fighter Technology, Perfume Booster and Optical Brightener, plus a larger 60g sachet (extra 10g), aimed at better day-to-day stain removal while maintaining value and affordability.

CEAT Kelani Holdings held its Partner Excellence Awards 2026 at Cinnamon Life to celebrate and reward its dealer and distributor network, with Abdeen Tyre Service winning the CEAT Best Dealer Award 2025/26. The two-day gala hosted 125 top dealers, 16 growth dealers, multiple distributors and partners and highlighted the firm's focus on next-generation tyre technology.

Colombo stocks closed flat with the ASPI up 0.01% at 21,132.12 and market turnover of Rs 1.41 billion; banks led turnover at Rs 411.6 million and Food, Beverage & Tobacco followed with Rs 308.7 million. Notable movers included Melstacorp, HNB, Pan Asia, Central Finance and Aitken Spence; Lanka Realty Investments disclosed an Rs 800m related-party loan settlement.

UNDP Assistant Secretary-General Kanni Wignaraja met Deputy Minister of Finance and Planning Dr. Anil Jayantha Fernando, commending the government's progress in stabilizing Sri Lanka's economy and reaffirming UNDP's commitment to continue partnership and support for the government's economic digitalization programme.

Scope Cinemas, with Sony Pictures Releasing International, staged what it says was Sri Lanka's biggest-ever movie premiere for Spider-Man: Brand New Day-featuring an exclusive red carpet, the country's first movie-themed drone show and multi-city fan events. The film opened in cinemas across Sri Lanka on 30 July 2026.

The Colombo Port Health Office, built with a grant from Japan and implemented by the IOM, was inaugurated on 28 July 2026 to strengthen Sri Lanka's port health infrastructure and emergency preparedness. The compact facility used a pre-engineered hybrid building system and advanced, corrosion-resistant façade materials to suit the marine environment.

Pitch Capital Properties (Pvt) Ltd won three awards at the Global Laurel Excellence Awards 2026, Most Trusted Land Developer, Outstanding Real Estate Investment Solutions, and Sri Lanka Property Excellence. The firm highlights its tourism-focused land portfolio (Devundara, Hiriketiya, Midigama) and a new project in Arugam Bay.

Exterminators PLC launched PACCP-X™, an AI-augmented pest management framework to shift pest control from reactive treatment to predictive prevention. The system combines AI, predictive analytics and smart monitoring across seven core elements for food, healthcare, hospitality and other sectors.

Melwa Group launched the Melwa Challenge Trophy 2026, holding the inaugural Gampaha District Championship on 29 July with 15 construction-industry teams; Vajira Hardware won and Negombo Kambi Centre were runners-up. The islandwide series moves to Ratnapura next, with district champions advancing to a grand finale.

Roar Global was named an OpenAI Select Partner, joining the OpenAI Partner Network to build, sell and deliver AI solutions and expand its OpenAI-related offerings and enterprise AI integration across the Asia‑Pacific region.

MAS Holdings has led the Adam's Peak Clean-Up Project, with the 2026 effort on 31 May bringing nearly 1,000 employee volunteers from its Bodywear value stream to conduct the largest clean-up to date. Volunteers cleaned the pilgrimage route from summit to base, collecting and responsibly disposing of waste and promoting environmental awareness.

The Ceylon Chamber of Commerce will host the Sri Lanka Economic & Investment Summit 2026 on Oct 12-13 at the Shangri-La Colombo to connect investors, government institutions and businesses to discuss economic reforms and investment opportunities. Registrations are open.

Toyota Lanka unveiled the All‑New Toyota Hilux and All‑New Toyota RAV4 2026 at its 'Unlocked' launch event in Wattala, showcasing models tropicalized for Sri Lanka. The company also reiterated plans to expand its network to more than 30 branches by end‑2026.

Advantis Group, the transportation and logistics arm of Hayleys PLC, is the Official Logistics Partner and Platinum Sponsor of University of Moratuwa's Falcon E Racing as the team competes at Formula Student Spain 2026; a contingent of 32 students and two lecturers has departed for the event.