Sri Lanka's services Purchasing Managers' Index, or PMI, rose to 61.4 in July 2026 from 58.4 in June, marking the highest reading since January and a fourth straight month of expansion, indicating a faster increase in services activity. New business continued to grow, though at a slower pace, easing to 60.2 from 62.5, with transportation and professional services leading the increase and financial and other personal services also contributing. Employment remained in expansionary territory but slowed to 52.9 from 54, supported by new recruitment and fewer staff resignations. Backlogs of work moved further into growth territory, rising to 51.2 from a neutral reading in June. Business expectations for the coming quarter strengthened on anticipated economic improvement and strong tourist arrivals for the Kandy Esala Perahera, though broader global economic uncertainty continued to pose downside risks.