Expansion levels for New Zealand’s services sector lifted again during February, according to the BNZ – BusinessNZ Performance of Services Index (PSI).
The PSI for January was 55.8 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining). This was up 1.1 points from December, and again above the long-term average of 53.6 for the survey.
BusinessNZ chief executive Kirk Hope said that the February result built on momentum from January. In terms of the sub-index results, the two key sub-index values of Activity/Sales (53.6) and New Orders/Business (57.1) both lifted from the previous month, as did Stocks/Inventories (58.3) and Supplier Deliveries (55.9) In contrast, Employment (51.2) did drop slightly from January.
“The further lift in expansion levels in the services sector also saw a sizeable drop in the proportion of negative comment, which stood at 51.9% in February, compared with 61.7% in January, 58.2% in December and 47.3% in November. Reasons were varied across those who outlined positive comments. The return of customers after the holiday season was one, along with a general pick-up in tourism, including overseas visitors”.
BNZ Senior Economist Craig Ebert said that “the strongly expanding PSI, along with the recovered tone of the PMI, suggests economic activity is growing relatively well in the early stages of this year”.
