BNZ – BusinessNZ
Performance of
Services Index

Easing back

19 Dec, 2022
53.7
November
-3.4

Monthly Change

expanding
slower rate

Expansion levels for New Zealand’s services sector eased back in November, according to the BNZ – BusinessNZ Performance of Services Index (PSI).

The PSI for November was 53.7 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining). This was down 3.4 points from October, and the lowest level of overall activity since April 2022. However, it was still just above the long-term average of 53.6 for the survey.

BusinessNZ chief executive Kirk Hope said that after showing healthy expansion for six months, the November result was dragged back by the key sub-index values for Activity/Sales (58.1) and New Orders/Business (57.3) coming off previously strong results, although both remain in a very healthy position. In addition, Supplier Deliveries (47.3) fell back into contraction during November.

“With its sister survey the PMI again showing contraction in November and economic headwinds approaching, the easing of expansion in activity is not unexpected. Also, with the Global PSI result of 48.1 at a 29-month low, it will be a tall order for the New Zealand services sector to continue the overall trends experienced during the second half of 2022”.

BNZ Senior Economist Craig Ebert said that “November’s PSI proved, for the third month running, to be an important counterpoint to the weakening PMI. It looks as though the services industries – just like they did in Q3 – will more than make up for any weakness in manufacturing in Q4, such that GDP for that quarter manages an expansion”.

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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

PSI

New Zealand’s Performance of Services Index (PSI) slowed a lot in November. From an elevated reading of 57.1 in October it eased to 53.7. While this reflected a sharp deceleration in the PSI’s employment index – to 51.8, from 57.1 – this component was still expansive. The drag factor is really in supplier deliveries which, at 47.3, fell back into contraction territory, after poking above the 50 breakeven level in October, with 52.0. This infers supply-side issues are not fully resolved. In contrast, the demand side still appears robust, with new orders/business, at 57.3 in November, coming in very close to normal.

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Varied in detail

By industry, there was a wide range of performance on show. Pronounced negativity in retail trade (30.7, compared to 52.8 in October) was something to note, especially in interpreting the festive spending figures from traditional retailers. At the other end of the spectrum, accommodation, cafes & restaurants (83.3) seemed very busy, as did cultural, recreational & personal (73.2) – both of which are sensitive to tourism along with COVID-related settings. This might also explain the region-besting result of 76.1 for Otago/Southland. As for firm-size, medium-to-large firms were trailing with 50.0 while large firms were the most positive, with (an unadjusted reading of) 65.0.

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Better serviced in NZ

The other positive message from New Zealand’s PSI is that it continues to look relatively good when compared to its international counterparts. The global PSI slipped to 48.1 in November, after dead flat results of 50.0 for September and October, and a solid reading of 53.9 back in June. While New Zealand’s PSI has also slowed noticeably over recent months, its level in November was about normal.

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Craig Ebert

Craig Ebert

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 Nov 2021 Jul 2022 Aug 2022 Sep 2022 Oct 2022 Nov 2022
BNZ – BusinessNZ PSI 48.4 54.8 58.4 55.7 57.1 53.7
Activity/Sales 48.0 55.6 67.5 59.6 61.0 58.1
Employment 50.6 52.7 51.3 50.7 57.1 51.8
New Orders/Business 54.7 60.9 67.1 62.3 59.6 57.3
Stocks/Inventories 48.2 53.8 59.8 54.6 56.1 55.0
Supplier Deliveries 39.9 49.0 49.5 49.4 52.0 47.3
View the Time Series Data

BNZ – BusinessNZ PSI Time Series

January 2016 – November 2022

International Results

J.P. Morgan Global Manufacturing PSITM

05 Dec 2022
48.1

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]

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New Zealand’s services sector fell back into contraction during December, according to the BNZ – BusinessNZ Performance of Services Index (PSI). The PSI for December was 48.8 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below...

View all PSI releases

BNZ – BusinessNZ
Performance of
Composite Index

53.0

GDP-Weighted Index

50.8

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 both ease in expansion during November.

The November GDP-Weighted Index (53.0) decreased 3.2 points from October, while the Free-Weighted Index (50.8) fell by 2 points.

PCI Time Series Table

The results are seasonally adjusted.

National Indicies Nov 2021 Jul 2022 Aug 2022 Sep 2022 Oct 2022 Nov 2022
GDP-Weighted Index 48.9 54.3 58.1 55.2 56.2 53.0
Free-Weighted Index 50.7 54.3 57.6 53.9 52.8 50.8
View the Time Series Data

BNZ – BusinessNZ PCI Time Series

January 2016 – November 2022

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