New business lifts services – PSI

16 Nov 2020

51.4

October

+1.0

Monthly Change

expanding

faster rate

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Kirk Hope

Chief Executive, BusinessNZ

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Activity in New Zealand’s services sector lifted slightly in October, according to the BNZ - BusinessNZ Performance of Services Index (PSI).

The PSI for October was 51.4, which was up 1 point from September (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining).  

BusinessNZ chief executive Kirk Hope said that while the overall small lift in expansion was positive, the sub-indices that make up the main result were mixed.

"New Orders/Business (58.4) lifted to its highest result since June, along with Stocks/Inventories (51.7) returning to expansion since July.  However, Employment (49.5) remains in contraction for the 8th consecutive month, while Production (49.9) fell back down under the 50.0 mark".

BNZ Senior Economist Craig Ebert said that "October’s PSI was still shy of its historical average of 54.0.  This was perhaps more disappointing than was the case for the PMI as the service sectors should arguably have been exhibiting a stronger rebound."

View the PSI Time Series Data


Main Indicies

Regional Results

Services Landscape
View Craig Ebert's profile

Craig Ebert

Senior Economist, BNZ

The PSI

Much like the Performance of Manufacturing Index (PMI) for October, the Performance of Services Index (PSI) warned about not over-forecasting the economic recovery that is broadly underway.
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Diverging Details

That said, the PSI details in October were a little different to those of the PMI. For instance, the PSI New Orders/Business index, which strengthened to 58.4, was counter to the fall we saw in the PMI’s, to 52.4.
Read more

GDP Scoping

With today’s PSI, and last Friday’s PMI, we can check in with what they are inferring with respect to overall economic growth. As it happens, they broadly align with our latest thinking on GDP.
Read more

The World's Woes?

Of course, New Zealand’s economic activity has already been compromised by the effective closing of borders to people. And even though the nation is otherwise open to international trade, there is still the issue of how the world economy is going out there.
Read more

View the BNZ Services Landscape

PSI Time Series Table

The results are seasonally adjusted.

National IndiciesOct
2019
Jun
2020
Jul
2020
Aug
2020
Sep
2020
Oct
2020
BNZ - BusinessNZ PSI 54.054.554.347.350.451.4
Activity/Sales 56.259.055.445.452.349.9
Employment50.845.749.547.648.949.5
New Orders/Business59.360.055.747.955.558.4
Stocks/Inventories50.652.456.049.344.251.7
Supplier Deliveries48.953.356.945.343.244.2

View the PSI Time Series Data

BNZ - BusinessNZ PSI Time Series

July 2014 – October 2020

PSI Time Series Graph

International Results

J.P. Morgan Global Manufacturing PSITM
4 Nov 2020

52.9

International PSI

BNZ - BusinessNZ PCI

51.4

GDP-Weighted Index

51.9

Free-Weighted Index

The seasonally adjusted BNZ - BusinessNZ Performance of Composite Index or PCI (which combines the PMI and PSI) saw the two options for measuring the PCI show mixed results during October, although both remained in expansion.

The October GDP-Weighted Index (51.4) rose 0.5 points from September, while the Free-Weighted Index (51.9) decreased 0.4 points.

PCI Time Series Table

The results are seasonally adjusted.

National IndicesOct
2019
Jun
2020
Jul
2020
Aug
2020
Sep
2020
Oct
2020
GDP-Weighted Index 53.754.755.047.850.951.4
Free-Weighted Index53.356.257.049.152.351.9

View the PCI Time Series Data

BNZ - BusinessNZ PCI Time Series

July 2014 – October 2020

PCI Time Series Graph