Top management in the wholesale and retail trade sector reported an overall expansion in business activity during Q1-2026, according to the Maldives Monetary Authority’s (MMA) Quarterly Business Survey.
The sector recorded growth in sales activity, supported by increased hiring and higher price levels, even as businesses operated under tightening financial conditions and constrained access to credit.
Employment and Recruitment Trends
The survey showed accelerated hiring across the wholesale and retail sector during the quarter. Employment levels increased overall, with businesses reporting a faster pace of new recruitment compared with other major sectors such as tourism and construction, which experienced slower hiring momentum.
The MMA noted that the index tracking employee numbers rose modestly, while wage and labour cost indicators recorded sharper increases, reflecting higher staffing costs across the sector.
Prices and Cost Pressures
Both input costs and average selling prices increased during Q1-2026. Businesses reported higher costs of sales, driven by broader inflationary pressures, with a large share of respondents indicating rising operational expenses.
The average selling price index also moved upward, reflecting the sector’s ability to pass some cost increases on to consumers during the quarter.
Looking ahead to Q2-2026, businesses expect input prices to continue rising, although at a slower pace. Selling prices are also projected to increase after a previous decline, signalling a partial reversal in pricing trends.
Financial Position and Credit Conditions
Despite growth in activity and employment, companies reported a deterioration in overall financial conditions during the quarter. The MMA survey highlighted that access to bank credit remained tight, continuing to constrain business operations and expansion plans.
Businesses operating in the wholesale and retail sector navigated these conditions alongside rising costs, shaping a more cautious financial outlook despite continued demand-driven activity.
Outlook
While the sector expanded in Q1-2026, expectations for the second quarter point to softer momentum. The survey indicates a more mixed outlook, with moderating cost pressures but continued financial constraints influencing business sentiment.
