New Zealand’s BusinessNZ Performance of Services Index edged up slightly in August, rising from 45.2 to 45.5, but still remains well below the long-term average of 53.2. The data shows that the service sector is continuing to struggle, with the index remaining in contraction for the sixth consecutive month, marking the longest period of decline since the global financial crisis.
Breaking down the numbers, activity/sales increased from 41.2 to 43.9, while employment also saw a slight rise from 47.0 to 43.9. However, new orders/business fell from 47.0 to 46.6, and stocks/inventories dropped from 45.3 to 44.6. Supplier deliveries improved marginally from 41.1 to 43.3.
The proportion of negative comments decreased to 60.8% in August, down from 67.0% in July and June. Despite the modest improvement, businesses continued to cite the high cost of living and challenging economic conditions as key concerns.
BNZ’s Senior Economist Doug Steel noted, “Smoothing through monthly volatility, the PSI’s 3-month average remains deep in contractionary territory at 43.9. The PSI has been in contraction for six consecutive months, which is the longest continuous period of decline since the GFC.”
