BNZ – BusinessNZ
Performance of
Services Index

Service sector conditions pick up in February – PSI

15 Mar, 2010

The service sector continued along its path of solid, if unspectacular expansion for the second month of 2010 according to the BNZ – BusinessNZ Performance of Services Index (PSI).

The PSI for February stood at 53.1. This was 0.6 points up from January, and up 7.4 points from February 2009. A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining. The average PSI value for 2007 was 58.1, while for 2008 it was 49.1. For 2009, the average score was 48.8.

BusinessNZ Chief Executive Phil O’Reilly said that both the main result and the indices that make up the PSI continued to show growth in the right areas, with new orders/business levels remaining strong and activity/sales lifting upwards.

“Comments from respondents continue to show distinct patterns, depending on whether they are positive or negative. Negative comments remain short and concise with ‘cash flow’ and ‘lack of demand’ dominating. On the positive side, comments are specific, with many outlining new customers, stronger growth or taking opportunities that present themselves. For many, the increase in activity/sales has been somewhat of a pleasant surprise, although most are conscious of any growth coming off a low base.”

Bank of New Zealand economist Doug Steel said the continuing recovery of the service sector is encouraging for the wider economy, but not yet fast enough for strong jobs growth.

“Seeing new orders continuing to lead the way is encouraging for the durability of the service sector expansion. The fact that this sector makes up around two thirds of the economy as a whole, is good news for the bigger picture of New Zealand’s recovery.

“However, there’s been a lack of acceleration in this expansion, and only mild net job creation as a result. We expect the unemployment rate to stay elevated for a while yet, but given where the economy has been over the last couple of years we have to walk before we can run.”

Three of the five sub-indices were in expansion mode, with only stocks/inventories (49.2) showing slight contraction after three consecutive months of slight expansion. New orders (58.9) continued to lead the way with another strong result, while activity/sales (55.6) also picked up from January to record a value similar to December. Employment (50.6) fell 2.1 points from January, but still remained in expansion for the fifth consecutive month. Supplier deliveries (50.0) slipped 0.3 points from the previous month to remain unchanged for February.

Activity was positive for three of the four main regions during February, with the Otago/Southland region (55.7) just ahead of the Northern region (54.7). The Central region (51.1) again fell back for the second consecutive month, while the Canterbury/Westland region (46.8) experienced its first contraction since June 2009. This was mainly due to a fall off in all sub-indices except new orders/business, which remained strong in that region.

Click here to view the February PSI & PCI
Click here to view the PSI time series data
Click here to view the PCI time series data

For media comment: Doug Steel ph 04 474 6923

BNZ - BusinessNZ PSI

Time Series Data

View seasonally adjusted and unadjusted time series data for the BNZ - BusinessNZ PSI

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.

BNZ – BusinessNZ PSI Time Series

January 1966 – January 1970

International Results

J.P. Morgan Global Manufacturing PSITM

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

PCI Time Series Table

The results are seasonally adjusted.

BNZ – BusinessNZ PCI Time Series

January 1966 – January 1970

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