BusinessNZ surveys show diverging results for the manufacturing and services sectors during June. The BNZ-BusinessNZ PSI survey of firms in the services sector including retailers shows a PSI of 55.4 (scores above 50 show expansion), with new orders expanding strongly. But the BNZ-BusinessNZ PMI survey of the manufacturing sector in June shows a PMI of 49.7, well below its long-term average of 53.1. Supply challenges and labour shortages are top of mind for manufacturers, BusinessNZ says.

Commentators are cautiously suggesting inflation in NZ has peaked. This month NZ recorded a 7.3% jump in annual inflation, sparked by increases in food, petrol and housing costs.  International oil prices have since fallen back from their peaks and some global food commodity prices have softened, suggesting international causes of inflation may be subsiding. But non-tradeables (goods and services that don’t face international competition) are at a record high, notes ANZ, and as domestically-driven inflation takes longer to dispel we might not be out of the woods yet.

Xero's latest small business survey says sales volumes are slowing for small businesses. Sales volumes in small businesses in NZ declined 4% over the last year. But the same period saw employment growth of 4.4% and wages rising 6.8%. There are growing financial pressures in the small business sector, and small business owners will need to balance declining sales growth with rising wage expectations in the coming months, Xero says.