New Zealand’s services sector experienced a return to expansion in September, according to the BNZ – BusinessNZ Performance of Services Index (PSI).
The PSI for September was 50.7 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining). This was up 3.0 points from August, although still below the long-term average of 53.5 for the survey.
BusinessNZ chief executive Kirk Hope said that the September result broke the trend of three consecutive months in contraction for the sector. New Orders/Business (53.9) led the charge, while Activity/Sales (50.9) picked up 6 points. In contrast, Employment (50.6) showed weaker expansion for the month, while Stocks/Inventories (47.9) fell back into contraction after two months in expansion.
“The proportion of negative comments stood at 61.8% for September, down slightly from 63.9% in August. Overall, negative comments continued to be strongly dominated by uncertainty regarding the upcoming General Election, as well as the cost of living”.
BNZ Senior Economist Craig Ebert said that “the seasonally adjusted reading of 50.7 was clearly better than August’s 19-month low of 47.7. However, it was also clearly south of its long-term average of 53.5. Stabilised but hardly buoyant”.