Expansion in New Zealand’s services sector continued to ease back marginally in September, according to the BNZ – BusinessNZ Performance of Services Index (PSI).
The PSI for September was 54.4, which was another 0.2 points down from August (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining). The September result was also exactly at the long term average of 54.4 for the survey.
BusinessNZ chief executive Kirk Hope said that the services sector has been fairly settled in terms of expansion over the last three months.
“The fact that new orders/business (59.3) improved to its highest result since January should assist with general business activity going forward. However, looking more broadly the gap in performance between the services and manufacturing sectors persists. With other key economic data showing a general trend decline, the question becomes to what degree will the services sector be affected by slowing influences elsewhere in the months ahead.
Looking at comments from respondents, the proportion of positive comments for September stood at 48.6%, compared with 51.8% in August and 47.6% in July.
BNZ Senior Economist Doug Steel said that “the solidity of the service sector remains in stark contrast to the manufacturing sector as portrayed by the still substandard Performance of Manufacturing Index (PMI) released last week. The PSI and PMI composite index continues to point to overall annual economic growth slowing to around the 1.5% mark”.
