Service measure stronger, but complicated by quake

Monday 16th May 2011

The BNZ-BusinessNZ performance of services index (PSI) last month reached its highest level since last September, but the result was complicated by the effects of the February earthquake in Christchurch.

The seasonally adjusted PSI for April was 1.5 points higher than in March at 52.6, with a reading above 50 points indicating services activity is expanding.

But unadjusted regional breakdowns showed all the improvement in April was from levels of severe contraction in most of the South Island in March, while the North Island fell back sharply.

Canterbury/Westland, which also includes Marlborough, rose from 39.5 in March to 57.5 last month, while Otago/Southland gained from 39.5 to 46.3.

BusinessNZ said the improvement in Canterbury/Westland was mainly due to a combination of businesses picking up more customers because supply was reduced, and the relocation of many businesses into other areas.

In the northern area - Northland, Auckland, Waikato, and Bay of Plenty - the PSI fell from 54.6 in March to 49.3 in April, while in the central area - the rest of the North Island, Nelson and Tasman - the reading dropped from 57.5 to 50.4.

NZPA

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