Service sector expansion slows
The service sector is still expanding, but has slowed from a jog to a walk in November.
The seasonally adjusted BNZ-Business NZ Performance of Service Index stood at 54.1 in November, down 4 points from October's strong result. An index above 50 points indicates service sector activity is expanding and below 50 that it is going backwards.
Four of the five main sub-indexes expanded in November, led by new orders and business at 58.1, though that was down almost 5 points from October.
New activity and sales fell back even more, down 9 points to 55.4, though remained in “healthy expansion”.
BusinessNZ chief executive Phil O'Reilly said comments from service firms showed a distinct difference between those that had seen activity expand, compared with those that had not.
In November, 65 per cent of comments were positive, compared with 62 per cent in October and 47 per cent in September.
“The increase is obviously good news, but the types of comments received are more specific to a particular reason such as better weather conditions, detailed Christmas prospects or certain tourist opportunities on the scene,” O'Reilly said.
In contrast, those still struggling were often more general in their comments, with a lack of customers and orders being the primary concern he said.
BNZ head of research Stephen Toplis expected 2012's theme of slow progress, despite continuing struggle, to continue into 2013.
“New Zealand's economic outlook for calendar 2013 is unspectacular, but against a global backdrop of significant distress, this is not a bad place to be."