Service sector growth index crawling ahead
New Zealand’s service sector is growing at a slower rate.
The latest BNZ-Business New Zealand performance of services index was 53.1 – anything above 50.0 indicates the sector is still growing. July’s result was down 0.8 points from June, but nowhere near the 2.5 point fall for the previous month.
According to the results, the central North Island area expanded the most – up at 55.5 points, while Canterbury/Westland continued the upward trend also – 53.4 points.
Business New Zealand chief executive Phil O’Reilly is putting the slow growth down to a lack of sales, which he says is top of the mind for those owners still finding conditions difficult.
BNZ economist Doug Steel says there is a lack of common factors in these monthly index levels.
“It has been all over the show. For every indicator pointing one way there seems to be another one pointing in another direction.
"At least, on average, the indicators point to moderate growth ahead,” he says.
Despite another dip in expansion levels, all five sub-indices remained in expansion during July.
New orders/business (58.8) continued to lead for the 22nd consecutive month, and recovered some lost ground from the June result.
Activity/sales (52.3) slipped a further 1.9 points from June after slipping 3.6 points from May.
Employment (52.5) and stocks/inventories (51.5) recorded an almost identical result to June, while supplier deliveries (50.3) moved closer to the no change mark.
Last week, the two agencies released the performance of manufacturing index. It showed the index had fallen just below the expansion line – now at 49.4.