New Zealand's services sector remained in expansion in July, though the pace eased for a second straight month. New orders/business continued to show the strongest growth.
The seasonally adjusted BNZ-BusinessNZ Performance of Service Index fell 0.8 points to 53.1 in July, following a 3.3 point decline in June.
The survey shows services are holding up better than manufacturing in the tepid New Zealand economy. The Performance of Manufacturing index, released last week, showed a contraction and the lowest reading for the month of July since 2008. A reading of 50 separates a contraction from an expansion.
The differences between the PSI and PMI "add to other economic information over the past few weeks that have brought more confusion than clarity as to how the economy is progressing", said Bank of New Zealand economist Doug Steel. Still, "we are happy to stick with this moderate growth story until the general mix of indicators give a clear steer one way or another".
New business/orders were 58.8 in the latest PSI, recovering some ground from June and remaining the leading sub-index for the 22nd straight month.
Activity/sales fell 1.9 points to 52.3, while employment at52.5 and stocks/inventories at 51.5 were little changed from the previous month. Supplier deliveries were on 50.3.
The BNZ-BusinessNZ Performance of Composite Index, which combines the PSI and the PMI, recorded a GDP-Weighted Index drop of 0.6 points to 52.7 and the Free-Weighted Index down 0.6 points to 51.3.