New orders turn positive as NZ services sector remains in doldrums: PSI

Monday 20th July 2009

New orders turned positive in New Zealand’s services industry for the first time in three months, a bright spot in a sector that has been mired in contraction for 15 straight months.

The Bank of New Zealand – Business NZ Performance of Services Index (PSI) slipped 1.2 points to 45 in June from May and was down from a reading of 45.6 in June 2008. A measure below 50 signifies contraction. New orders/business picked up to 50.8 from 49.7 in May.

The PSI mirrors last week’s Performance of Manufacturing index in showing an improvement in forward orders and comes amid evidence “that over-stocking was being dealt with in an aggressive manner,” said Craig Ebert, senior economist at Bank of New Zealand.“These are good omens for forward production,” he said.

Activity/sales were unchanged from the previous month at 43.9.

Still, other measures in the PSI weakened. Employment slipped to 43.6 from 46.3, while stocks/inventories declined to 41 from 44.7.Supplier deliveries decreased to 42.2 from 44.7.

Businesswire.co.nz

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