The first month of Spring brought about continued upwards expansion in the service sector, according to the >BNZ Capital – BusinessNZ Performance of Services Index (PSI).
The PSI for September stood at 53.2, which was 1.9 points up from August. In comparison with previous years, the September result was 6.3 points up from September 2008, but 5.8 points down from 2007. 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. So far for 2009, the average score has been 47.3.
BusinessNZ chief executive Phil O’Reilly said that the ongoing momentum in overall activity will most likely continue as positive comments from respondents tended to focus on Christmas approaching, the weather improving and people feeling more confident about spending. Certainly, the more forward-looking new business/activity component of the PSI continuing to edge up should filter through to activity/sales during the last quarter of the year.
“New Zealand remains on track with offshore developments in the service sector, as evidenced with results from the JPMorgan Global PSI at 52.2 for September. Also, we continue to remain above Australia (49.9), who also to show improvement but at a slower pace.
Like August, only two of the five diffusion indices that make up the PSI exhibited expansion, but involved the two key indicators of activity/sales (58.0) and new orders/business (58.6) that increased 7.5 points and 1.0 point respectively. The former was the highest result since November 2007. Employment (48.0) slipped back slightly from the August result, and remains in contraction now for 19 months. Stocks/inventories (46.9) also slipped back from the previous month, while deliveries (49.3) continued to show upwards movement to reach its highest result since March 2009 (albeit still in decline).
Activity was positive for three of the four main regions during September, with the Northern region (55.8) recording its highest result since November 2007, as well as the strongest regional result for the current month. The Central region (50.4) fell back slightly from August, although still exhibited slight expansion. The Canterbury/Westland region (51.5) also experienced a dip in expansion after consecutive values above 53.0, while the Otago/Southland region (45.6) dropped back to levels experienced in June/July after a brief recovery in August.
Click here to view the September PSI & PCI
Click here to view the PSI time series data
Click here to view the PCI time series data
For media comment: Stephanie Moakes, ph 04 496 6554, or 021 959 831.
