BNZ – BusinessNZ
Performance of
Services Index

Contraction continues – PSI

15 Feb, 2021
47.9
January
-1.2
contracting
faster rate

Activity in New Zealand’s services sector remained in contraction for a third consecutive month, according to the BNZ – BusinessNZ Performance of Services Index (PSI).

The PSI for January was 47.9, which was down 1.2 points from December (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining). This was also well below the long term average of 53.8 for the survey.

BusinessNZ chief executive Kirk Hope said that the January result was generally negative when examined more deeply.

“While New Orders/Business (53.7) remained in expansion mode, the remaining sub-indices all displayed contraction, including Activity/Sales (46.4) and Employment (46.9).  Looking at the comments made by respondents, the ongoing trend of contraction was typified by the influences of the Xmas period, ongoing COVID-19 related issues (including freight challenges) and a slower return to business as usual post holidays”.

BNZ Senior Economist Doug Steel said that “combining last week’s very strong PMI with today’s soft PSI points to some slowing in growth. But we also need to factor in strong public sector jobs growth and a booming construction sector”.

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

Soft Serve

A very strong bounce in Q3 GDP and solid Q4 labour market data shows the NZ economy is generally in a much better place than forecasters thought would be the case.  But that does not mean progress has been uniform.
Read more

Supply Side Issues Still Evident

Looking across the major PSI components in January, softness was visible in sales activity and employment after somewhat better readings in December.
Read more

Hospitality Hurting

After some better readings in previous months, the accommodation, cafes, and restaurant’s PSI slumped to an unadjusted 41.9 in January.
Read more

Not all bad

A weak PSI result fits with our long-held cautious view around near-term GDP, including a likely decline in the first quarter of 2021.
Read more

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.

PSI Time Series Table

The results are seasonally adjusted.

National Indicies Jan
2020
Sep
2020
Oct
2020
Nov
2020
Dec
2020
Jan
2021
BNZ – BusinessNZ PSI 57.4 50.1 50.8 46.6 49.1 47.9
Activity/Sales 56.0 52.4 50.0 45.6 51.0 46.4
Employment 53.3 49.1 49.7 49.0 52.8 46.9
New Orders/Business 63.8 54.9 57.2 52.1 50.9 53.7
Stocks/Inventories 57.3 45.3 51.8 45.8 48.4 49.9
Supplier Deliveries 56.4 42.9 43.8 38.9 39.7 41.6

BNZ – BusinessNZ PSI Time Series

January 2017 – January 2021

International Results

J.P. Morgan Global Manufacturing PSITM

03 Feb 2021
51.6

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.

PSI Releases

Uplift – PSI

Expansion levels for New Zealand's services sector saw a sizeable uplift in August, according to the BNZ - BusinessNZ Performance of Services Index (PSI).The PSI for August was 58.6 (A PSI reading above 50.0 indicates that the service sector is generally expanding;...

Easing off – PSI

Expansion levels for New Zealand's services sector decreased in July, according to the BNZ - BusinessNZ Performance of Services Index (PSI).The PSI for July was 51.2 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it...

Consistent service – PSI

Activity levels for New Zealand’s services sector in June displayed almost identical levels to last month, according to the BNZ – BusinessNZ Performance of Services Index (PSI).

Upwards momentum – PSI

Activity levels in New Zealand’s services sector displayed upwards momentum during May, according to the BNZ – BusinessNZ Performance of Services Index (PSI).

Evening out – PSI

Activity levels in New Zealand’s services sector during April were almost identical to March, according to the BNZ – BusinessNZ Performance of Services Index (PSI).

BNZ – BusinessNZ
Performance of
Composite 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 contrasting results in January.

The January GDP-Weighted Index (49.2) remained unchanged from December.  However, the Free-Weighted Index (52.5) increased 3.0 points, given the PMI went into solid expansion during January.

PCI Time Series Table

The results are seasonally adjusted.

National Indices Jan
2020
Sep
2020
Oct
2020
Nov
2020
Dec
2020
Jan
2021
GDP-Weighted Index 56.2 50.6 50.9 47.7 49.2 49.2
Free-Weighted Index 52.1 52.2 51.6 50.7 49.5 52.5

BNZ – BusinessNZ PCI Time Series

January 2017 – January 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