Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Holding pattern - PSI for August 2013


Media release
16 September 2013

Holding pattern

New Zealand’s services sector displayed a lower level of expansion after recent record results, according to the BNZ - BusinessNZ Performance of Services Index (PSI).

The PSI for August was 53.2.  This was down 5.0 points from July, and the lowest level of activity since January this year (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining).  Compared to previous August results, the 2013 value was up on 2012, but lower than 2011.  So far in 2013 the PSI has averaged 54.5.

BusinessNZ chief executive Phil O’Reilly said an August figure that trumped July’s result would have been remarkable given the previous month’s result was the highest since 2007.  However, the August value continues the story evident during 2013 of solid growth.

“The lower level of expansion during August meant the proportion of positive comments dropped from 62% in July to 54% for the current month.  Of those who provided positive comments, many outlined the general positive business environment at present, along with a more buoyant attitude.  For those who provided negative comments, many cited competitive pressures.

BNZ Economist Doug Steel said the overall positive trends in the service sector imitate those in the manufacturing, building and agriculture sectors. It all bodes well for stronger economic growth ahead, after what appears to have been a soft Q2. The positive overall economic picture makes it difficult to get too downbeat on some of the softer detail in August’s PSI survey. Still, they are worth monitoring.

Despite the dip in the level of expansion, none of the five main sub-indices were in decline during August, which has now been the case for the last four months.  New orders/business (55.2) and activity/sales (55.2) were tied for the highest level of activity for August, while stocks/inventories (53.6) and supplier deliveries (53.4) also produced similar levels of activity.  Employment (50.0) gave up its gain from July to return to a position of no change as in June.

There was a clear difference in activity levels between the North and South Islands.  In the North Island, the Northern region (55.5) led the way, despite falling 7.1 points from July.  The Central region (53.5) improved 3.0 points, with its highest value since April 2013.  In the South Island, the Canterbury/Westland region (42.1) fell back further from July, while the Otago/Southland region (36.5) experienced a significant drop for August, due to low activity and new business. 

The seasonally adjusted BNZ - BusinessNZ Performance of Composite Index or PCI (which combines the PMI and PSI) for August saw both options for measuring the PCI return to more familiar levels of expansion after a stellar result for July.  The GDP-Weighted Index (54.0) decreased 4.4 points from July, while the Free-Weighted Index (55.6) fell 3.6 points over the same period.  The fact that both the manufacturing and services sectors experiencing a lower level of expansion during August meant both measures also fell accordingly.

Link to the August PSI & PCI
Link to PSI time series data
Link to PCI time series data

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Half Full: Dairy Payouts Steady, Cash Will Be Tight

Industry body DairyNZ is advising farmers to focus on strong cashflow management as they look ahead to the 2015-16 season following Fonterra's half-year results announcement today. More>>

ALSO:

First Union: Cotton On Plans To Use “Tea Break” Law

“The Prime Minister reassured New Zealanders that ‘post the passing of this law, will you all of a sudden find thousands of workers who are denied having a tea break? The answer is absolutely not’... Cotton On is proposing to remove tea and meal breaks for workers in its safety sensitive distribution centre. How long before other major chains try and follow suit?” More>>

ALSO:

Scoop Business: NZ-Korea FTA Signed Amid Spying, Lost Sovereignty Claims

A long-awaited free trade agreement between New Zealand and South Korea has been signed in Seoul by Prime Minister John Key and the Korean president, Park Geun-hye. More>>

ALSO:

PM Visit: NZ And Viet Nam Agree Ambitious Trade Target

New Zealand and Viet Nam have agreed an ambitious target of doubling two-way goods and service trade to around $2.2 billion by 2020, Prime Minister John Key has announced. More>>

ALSO:

Scoop Business: NZ Economy Grows 0.8% In Fourth Quarter

The New Zealand economy expanded in the fourth quarter as tourists drove growth in retailing and accommodation, and property sales increased demand for real estate services. More>>

ALSO:

Scoop Business: RBNZ’s Wheeler Keeps OCR On Hold, No Rate Hikes Ahead

The Reserve Bank has removed the prospect of future interest rate hikes from its forecast horizon as a strong kiwi dollar and cheap oil hold down inflation, and the central bank ponders whether to lower its assessment of where “neutral” interest rates should be. The kiwi dollar gained. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news