New Zealand service sector activity expanded at a slightly quicker pace in September than a month earlier, and alongside its sister manufacturing survey continues to point to above-average economic growth.
The BNZ-BusinessNZ performance of services index rose 0.3 of a point to 58 in September from August, and was upfrom 56.5 in the same month a year earlier. The service sector, which accounts for about two-thirds of the economy, has been in expansion since July 2010, where a reading above 50 indicates increased activity.
Bank of New Zealand economist Craig Ebert said today's report affirms upbeat expectations from the service sector in the New Zealand Institute of Economic Research's quarterly survey of business opinion, with positive employment and investment intentions.
The PSI follows its sister survey, the performance of manufacturing index, released last week, which showed industrial production stepped up in September with a pick-up in agriculture fuelling food and beverage activity, and BNZ's Ebert said the two services were "consistent with above-trend economic (GDP) growth."
The performance of composite index, which combines the PSI and PMI measures, increased 0.4 of a point to 58.2 on a GDP-weighted basis, and gained 1.4 points to 58.7 on a free-weighted basis.
All five sub-indices of the PSI were in expansion in September, the fourth month of broad-based activity gains, led by new orders/business at 61 and activity/sales at 60.3. Employment slipped from a record reading in August to 55, while supplier deliveries was at 53.2 and stocks/inventories at 50.7.
All sub-sectors were back in expansion, with retail trade at 51.9, having reported contracting activity in August. Wholesale trade led the sector activity at 61.4, followed by health and community services at 60.8, and property and business services at 51.7.
Otago/Southland led activity across the regions at 66, with Canterbury/Westland at 58, Central at 57.1 and Northern at 56.5.
