The September Focus – Our updated Macro Forecasts for 2026 and 2027 – looks at the numbers we expect for Sri Lanka’s fiscal and external fronts by taking into account the latest developments we’ve seen in the economy so far and the structural features that mostly drive the longer-term story of Sri Lanka’s economy.
On the fiscal front, despite the biggest oil shock in a generation, Sri Lanka continues to show strong revenue collection and contained government expenditure despite some level of spending coming through. Similar to the past two years, this has given rise to healthy fiscal surpluses so far during the year and could potentially continue to be a recurring feature in Sri Lanka’s fiscal landscape. We dive deeper into our detailed explanations covering the different drivers across both, revenue and expenditure items that we see are structurally changing.
On the external front, we explore the impact on oil prices onto our import bill for 2026 and 2027 alongside the rest in the trade account, while also covering the services account of the Balance of Payments with a particular focus on Tourism, and Remittances which are two of the main drivers of Sri Lanka’s external sector performance. We also look at our broad outlook on external debt repayments, reserve accumulation, other drivers of the current account and look at private sector credit activity before giving the breakdown of our external forecasts for end-26 and 27.
Our clients would have already received a detailed report to their emails on this; alongside the numbers we associate with each of these varied scenarios. The full report has also been accessible on our Athena reports platform since the 25th September 2026. If you still haven’t had a chance to read through it, click here! If you are yet to be a subscriber, please do get in touch with us for a trial subscription to our reports at clientconnect@frontiergroup.info.