Expansion levels for New Zealand’s services sector decreased in March, according to the BNZ – BusinessNZ Performance of Services Index (PSI).
The PSI for March was 54.4 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining). This was down 1.4 points from February, but still above the long-term average of 53.6 for the survey.
BusinessNZ chief executive Kirk Hope said that the March result was relatively consistent with activity levels seen so far during 2023. In terms of the sub-index results, Activity/Sales (56.7) rose to its highest level since November 2022, while in contrast New Orders/Business (53.1) dropped to its lowest level of expansion since July 2022. Employment (51.3) remained very stable over the first three months of 2023, while both Stocks/Inventories (57.3) and Supplier Deliveries (55.0) both slipped slightly over March.
“Although there was a moderate decline in expansion levels during March, the proportion of negative comments jumped from 51.9% in February to 58.6% in March. A cooling economy, effects of price increases and general uncertainty were the main comments that came through”.
BNZ Senior Economist Craig Ebert said that “while the PSI held reasonably firm in March, the PMI slipped into a slightly negative position. Still, there was enough in them, overall, to suggest a positive underlying tendency in activity”.
