BNZ – BusinessNZ
Performance of
Services Index

Above average – PSI

14 Jun, 2021
56.1
May
-5.1

Monthly Change

expanding
slower rate

New Zealand’s services sector continued in expansion mode during May, according to the BNZ – BusinessNZ Performance of Services Index (PSI).

The PSI for May was 56.1 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining).  Although this was down 5.1 points from its highest ever result in April, it was still above its long term average of 53.9.

BusinessNZ chief executive Kirk Hope said that the drop in the level of expansion for May was not unexpected, given the significant level of activity seen in April.

“New Zealand continues to follow global trends with strong New Orders/Business (62.1) and Activity/Sales (58.7).  However, Supplier Deliveries (45.1) remains solidly in contraction.”

BNZ Senior Economist Doug Steel said that “while the current strength in the PSI (and PMI) says good things for economic growth over coming quarters, the obvious supply side stresses suggests significant upward pressure is building on inflation.”

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Kirk Hope

Kirk Hope

CEO, BusinessNZ

BNZ - BusinessNZ PSI

Time Series Data

View seasonally adjusted and unadjusted time series data for the BNZ - BusinessNZ PSI

Services Landscape

Strong expansion

Service sector expansion remains strong. The Performance of Service Index (PSI) headline reading of 56.1 in May portrays strength. Sure, it didn’t match April’s record high of 61.2, but it is still well above its long-term average of 53.8, indicating above average growth.
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With challenges

Amid the broad positive tenor of the PSI, the service sector is not without significant challenges. First, the general lack of international tourism and education continues to see acute pain in parts, even if the trans-Tasman bubble has helped some at the margin. Second, supply side issues are pervasive and persistent.
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Demand pressuring supply

In contrast to the considerable difficulties on the supply side, demand looks vigorous. Combining PSI new orders and sales as an indicator of demand gives a May average of 60.4. That far exceeds the combination of PSI employment, inventories, and supplier deliveries which averaged 50.3 in the month.
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View full BNZ Services Snapshot
Doug Steel

Doug Steel

Senior Economist, BNZ

Sponsor Statement

BNZ is delighted to be associated with the Performance of Services Index (PSI) and BusinessNZ.

This association brings together the significant experience of leading business advocacy body BusinessNZ, and business finance specialist BNZ.

We look forward to continuing our association with BusinessNZ and associated regional organisations, and to playing our part in the ongoing development of the New Zealand service sector.

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PSI Time Series Table

The results are seasonally adjusted.

National Indicies May
2020		 Jan
2021		 Feb
2021		 Mar
2021		 Apr
2021		 May
2021
BNZ – BusinessNZ PSI 39.4 48.1 49.7 52.9 61.2 56.1
Activity/Sales 34.4 47.1 51.9 55.7 62.2 58.7
Employment 40.4 46.0 51.4 52.1 60.8 54.3
New Orders/Business 38.3 53.9 50.5 58.2 68.1 62.1
Stocks/Inventories 45.9 50.0 46.5 50.6 54.9 51.6
Supplier Deliveries 41.1 42.3 41.5 44.3 46.9 45.1
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BNZ – BusinessNZ PSI Time Series

May 2017 – May 2021

International Results

J.P. Morgan Global Manufacturing PSITM

03 Jun 2021
59.4

About the PSI

The BNZ – BusinessNZ Performance of Services Index is a monthly survey of the service sector providing an early indicator of activity levels.

A PSI reading above 50 points indicates service activity is expanding; below 50 indicates it is contracting.

The main PSI and sub-index results are seasonally adjusted.

Technical Contact

Stephen Summers
Economist, BusinessNZ

[email protected]

PSI Releases

Stuck in a rut

New Zealand’s services sector result for October remained in contraction, according to the BNZ – BusinessNZ Performance of Services Index (PSI). The PSI for October was 46.0 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0...

Same same

September's result for New Zealand’s services sector remained the same as August, although still firmly in contraction mode, according to the BNZ – BusinessNZ Performance of Services Index (PSI). The PSI for September was 45.7 (A PSI reading above 50.0 indicates that...

Slow crawl

Activity in New Zealand’s services sector inched its way higher during August, although still firmly in contraction territory, according to the BNZ – BusinessNZ Performance of Services Index (PSI). The PSI for August was 45.5 (A PSI reading above 50.0 indicates that...

Relative progress

Activity in New Zealand’s services sector for July showed some improvement after a horrendous June result, according to the BNZ – BusinessNZ Performance of Services Index (PSI). The PSI for July was 44.6 (A PSI reading above 50.0 indicates that the service sector is...

Sinking

Activity in New Zealand’s services sector sunk even further during June, according to the BNZ – BusinessNZ Performance of Services Index (PSI). The PSI for June was 40.2 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0...

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BNZ – BusinessNZ
Performance of
Composite Index

56.8

GDP-Weighted Index

57.8

Free-Weighted Index

The seasonally adjusted BNZ – BusinessNZ Performance of Composite Index or PCI (which combines the PMI and PSI) saw the two options for measuring the PCI show lower levels of expansion for May.

The May GDP-Weighted Index (56.8) decreased 3.8 points from April, while the Free-Weighted Index (57.8) slid 1.3 points to return to expansion levels seen in March.

PCI Time Series Table

The results are seasonally adjusted.

National Indices May
2020		 Jan
2021		 Feb
2021		 Mar
2021		 Apr
2021		 May
2021
GDP-Weighted Index 39.9 49.4 50.4 54.2 60.6 56.8
Free-Weighted Index 40.3 53.2 52.2 57.8 59.1 57.8
View the Time Series Data

BNZ – BusinessNZ PCI Time Series

May 2017 – May 2021

About the PCI

The BNZ – BusinessNZ Performance of Composite Index (PCI) takes into account results from both the Performance of Manufacturing Index (PMI) and the Performance of Services Index (PSI). Combined results are shown in two ways:

GDP-Weighted Index:
Apportions the weight of the manufacturing and services index within the economy to produce an overall result.

Free-Weighted Index:
Combines data from both indexes to produce an overall result.

Both time series for the PCI are then seasonally adjusted.

BNZ - BusinessNZ PCI

Time Series Data

View seasonally adjusted and unadjusted time series data for the BNZ - BusinessNZ PCI

Our Contributors

The BNZ – BusinessNZ PSI contains data obtained through BusinessNZ’s regional organisations