NZ services sector grows at fastest pace in four months in February
March 18 (BusinessDesk) – New Zealand’s services sector grew at the fastest pace in four months in January, adding to signs that business activity has strengthened in recent months.
The BNZ-BusinessNZ Performance of Services Index rose 2.7 points to 55.5 in February, the highest reading since October last year and the high recorded for the month of February since the survey began in 2007.
The PSI follows its sister survey on manufacturing, released last Friday, which showed a third month of expansion to the highest level in a year. The Reserve Bank kept the official cash rate at a record low 2.5 percent last week and said it is unlikely to hike rates this year to give the economy time to recover.
All five sub-indexes in the PSI were in expansion last month. New orders/business was on 59.6, activity/sales on 55.4 and employment rose 2.4 points to 52.5, the highest since April last year. A reading of 50 separates contraction from expansion.
Stocks/inventories were on 53.3 and supplier deliveries were on 55.8.
The PMI and PSI surveys “gives us some heart that the economy overall is progressing well this year so far, after what we think was a reasonable expansion in the final quarter of last year,” said Bank of New Zealand economist Craig Ebert.
Today’s report showed the Northern region was on 56.5, Central was on 54.5, Canterbury/Westland on 59.1 and Otago/Southland on 61.9.