Above average – PSI 14 Jun 2021 56.1May-5.1Monthly Changeexpandingslower rate Kirk Hope Chief Executive, BusinessNZ View profile New Zealand's services sector continued in expansion mode during May, according to the BNZ - BusinessNZ Performance of Services Index (PSI).The PSI for May was 56.1 (A PSI reading above 50.0 indicates that the service sector is generally expanding; below 50.0 that it is declining). Although this was down 5.1 points from its highest ever result in April, it was still above its long term average of 53.9.BusinessNZ chief executive Kirk Hope said that the drop in the level of expansion for May was not unexpected, given the significant level of activity seen in April."New Zealand continues to follow global trends with strong New Orders/Business (62.1) and Activity/Sales (58.7). However, Supplier Deliveries (45.1) remains solidly in contraction."BNZ Senior Economist Doug Steel said that "while the current strength in the PSI (and PMI) says good things for economic growth over coming quarters, the obvious supply side stresses suggests significant upward pressure is building on inflation." View the PSI Time Series Data Main Indicies Regional Results Services Landscape Doug SteelSenior Economist, BNZ Strong expansionService sector expansion remains strong. The Performance of Service Index (PSI) headline reading of 56.1 in May portrays strength. Sure, it didn’t match April’s record high of 61.2, but it is still well above its long-term average of 53.8, indicating above average growth.Read moreWith challengesAmid the broad positive tenor of the PSI, the service sector is not without significant challenges. First, the general lack of international tourism and education continues to see acute pain in parts, even if the trans-Tasman bubble has helped some at the margin. Second, supply side issues are pervasive and persistent.Read moreDemand pressuring supplyIn contrast to the considerable difficulties on the supply side, demand looks vigorous. Combining PSI new orders and sales as an indicator of demand gives a May average of 60.4. That far exceeds the combination of PSI employment, inventories, and supplier deliveries which averaged 50.3 in the month.Read more View the BNZ Services Landscape PSI Time Series TableThe results are seasonally adjusted. National IndiciesMay2020Jan2021Feb2021Mar2021Apr2021May2021 BNZ - BusinessNZ PSI 39.448.149.752.961.256.1 Activity/Sales 34.447.151.955.762.258.7 Employment40.446.051.452.160.854.3 New Orders/Business38.353.950.558.268.162.1 Stocks/Inventories45.950.046.550.654.951.6 Supplier Deliveries41.142.341.544.346.945.1 View the PSI Time Series Data BNZ - BusinessNZ PSI Time Series January 2016 – May 2021 International ResultsJ.P. Morgan Global Manufacturing PSITM 3 Jun 202159.4 56.8GDP-Weighted Index57.8Free-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 lower levels of expansion for May.The May GDP-Weighted Index (56.8) decreased 3.8 points from April, while the Free-Weighted Index (57.8) slid 1.3 points to return to expansion levels seen in March. PCI Time Series TableThe results are seasonally adjusted. National IndicesMay2020Jan2021Feb2021Mar2021Apr2021May2021 GDP-Weighted Index 39.949.450.454.260.656.8 Free-Weighted Index40.353.252.257.859.157.8 View the PCI Time Series Data BNZ - BusinessNZ PCI Time Series January 2016 – May 2021 In this section Surveys & Statistics Performance of Manufacturing Index Performance of Services Index Compliance Cost Survey Exporters Survey Southern Cross Health Society - BusinessNZ Wellness in the Workplace Survey Reports & Publications BusinessNZ Planning Forecast International BusinessNZ RAT Suppliers Guides & Tools BusinessNZ RAT Suppliers RATs for non-critical business, agencies and organisations BNZ - BusinessNZ PSI Time Series Data View seasonally adjusted and unadjusted time series data for the BNZ - BusinessNZ PSI BNZ - BusinessNZ PCI Time Series Data View seasonally adjusted and unadjusted time series data for the BNZ - BusinessNZ combined PMI & PSI. BNZ is delighted to be associated with the Performance of Services Index (PSI) and BusinessNZ.This association brings together the significant experience of leading business advocacy body BusinessNZ, and business finance specialist BNZ.We look forward to continuing our association with BusinessNZ and associated regional organisations, and to playing our part in the ongoing development of the New Zealand service sector. View website Media Comment For media comment, please contact: Kirk Hope, 04 496 6560 Doug Steel, BNZ 04 474 6799 Technical Comment For more information or assistance with data interpretation, please contact: Steve Summers 04 496 6564 ssummers@businessnz.org.nz Our ContributorsThe BNZ - BusinessNZ PSI contains data obtained through BusinessNZ's regional organisations About the PSIThe BNZ - BusinessNZ Performance of Services Index is a monthly survey of the service sector providing an early indicator of activity levels.A PSI reading above 50 points indicates service activity is expanding; below 50 indicates it is contracting.The main PSI and sub-index results are seasonally adjusted.About the PCIThe BNZ - BusinessNZ Performance of Composite Index (PCI) takes into account results from both the Performance of Manufacturing Index (PMI) and the Performance of Services Index (PSI). Combined results are shown in two ways: GDP-Weighted Index: Apportions the weight of the manufacturing and services index within the economy to produce an overall result. Free-Weighted Index: Combines data from both indexes to produce an overall result.Both time series for the PCI are then seasonally adjusted. Related Articles RMA shakeup long overdue Softening in September – PSI Spring is in the air Smooth operator – PSI Easing expansion – PSI View more