The services sector ended on a solid note in 2014, with expansion improving during December, according to the BNZ – BusinessNZ Performance of Services Index (PSI).
The PSI for December was 56.5. This was 1.8 points up from November, and similar to expansion levels seen in October. Over 2014 the PSI also averaged 56.5 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining).
BusinessNZ chief executive Phil O’Reilly said 2014 represented a positive and solid year for the services sector in New Zealand.
“With the sector averaging 56.5 over 2014, this was the highest yearly average score for a full calendar year since the survey began in 2007. Also, comments received have remained mostly over 60% positive, with nothing at this stage to suggest this should not continue into 2015”.
BNZ senior economist Craig Ebert said there was a strong theme of service-sector expansion keeping solid pace with the overall economy.
“This result is consistent with other data, including the NZIER Quarterly Survey of Business Opinion,” Mr Ebert said.
For the seventh month running all five main sub-indices were in expansion. New orders/business (60.3) increased 4.2 points to return to similar expansion levels experienced in October. This was followed by activity/sales (57.3), which also experienced a lift compared with the previous month. Supplier deliveries (56.2) recorded its highest value since August, while stocks/inventories (54.8) experienced its third consecutive increase in expansion. Employment(51.9) dipped after a slight recovery in November, although still showed slight expansion.
Activity remained positive throughout the country, although again there were some movements in relation to the previous month. In the North Island, the Northernregion (57.6) rose 2.1 points to regain some of the expansion lost in November, while the Central region (50.0) experienced no change, and an almost identical result to October’s. In the South Island, the Canterbury/Westland region (51.5) fell 5.3 points from November, while the Otago/Southland region (65.4) remained all but unchanged in terms of its expansion from the previous month.
The seasonally adjusted BNZ – BusinessNZ Performance of Composite Index or PCI (which combines the PMI and PSI) for December saw the two options for measuring the PCI both return to levels experienced around the last half of 2014. The GDP-Weighted Index increased 2.6 points from November to stand at 56.7, while the Free-Weighted Index (57.5) rose 3.5 points from November. These meant the two options both averaged 56.5 over 2014.
Click here to view the December PSI & PCI
Click here to view the PSI time series data
Click here to view the PCI time series data
For media comment: Phil O’Reilly 04 4966552 or Craig Ebert 04 4746799
