Service sector expands in August
Service sector index records highest August result since 2007.
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The service sector continued to expand in August but at a slightly slower pace, according to the BNZ - BusinessNZ Performance of Services Index (PSI).
The PSI for August was 53.9. This was down 0.6 points from 54.5 in July, but the highest August result since 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 2009 was 48.8, while for 2010 it was 53.2. So far for 2011, it is 52.8.
BusinessNZ chief executive Phil O’Reilly says the August result was helped by ongoing solid results for new business and sales.
“Although employment and stocks showed contraction in August, new business and activity pulled through again with levels of expansion similar to both June and July. Also, it is pleasing to see that recent influences on business activity are constructive, with the proportion of positive comments left by respondents in August (58.8%) increasing significantly from July (50.0%),” he says.
“Looking ahead, time will tell whether the recent kick-off of the World Cup will help boost the service sector results further, particularly within the hospitality and tourism areas.”
BNZ economist Craig Ebert says these are consistent with a range of other business surveys that have proved remarkably robust.
“It’s not just the latest PSI and PMI readings that give us encouragement through what has been another very difficult year – initially with the earthquakes and then globally,” Mr Ebert says.
Niko Kloeten
Mon, 19 Sep 2011
Mon, 19 Sep 2011
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Service sector expands in August
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