WELLINGTON, Jan 26 (Reuters) - Activity in New Zealand's services sector improved slightly in December, but remained in contraction as recession made consumers cautious, a survey showed on Monday.
The Bank of New Zealand-Business NZ's performance of services index (PSI) rose 0.7 points to 48 last month.
The index, which is not seasonally adjusted, has been below 50, the level indicating contraction, since April last year. It is down 5.9 points on the same month a year ago.
Business NZ said the outlook for the sector was negative.
'Results have remained in a consistent band showing contraction, which will most likely continue through to 2009,' said Business NZ's chief executive, Phil O'Reilly.
Four of five sub-indices remained in contraction with the employment sub-index showing the steepest decline. Supplier deliveries was the only category to expand.
The New Zealand economy fell into its first recession in a decade in the first half of last year and many analysts believe it will continue into the middle of this year.
The Reserve Bank of New Zealand, which has slashed interest rates by a total of 325 basis points since last July, is expected to cut by a further 1 percentage point on Thursday to a record low 4 percent.
The survey, based on responses from more than 300 service sector companies, mirrors a long-established poll for manufacturing also conducted by Business NZ.
(Reporting by Gyles Beckford) Keywords: NEWZEALAND ECONOMY/SERVICES (gyles.beckford@reuters.com ; +64 4 471 4231; Reuters Messaging: gyles.beckford.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The Bank of New Zealand-Business NZ's performance of services index (PSI) rose 0.7 points to 48 last month.
The index, which is not seasonally adjusted, has been below 50, the level indicating contraction, since April last year. It is down 5.9 points on the same month a year ago.
Business NZ said the outlook for the sector was negative.
'Results have remained in a consistent band showing contraction, which will most likely continue through to 2009,' said Business NZ's chief executive, Phil O'Reilly.
Four of five sub-indices remained in contraction with the employment sub-index showing the steepest decline. Supplier deliveries was the only category to expand.
The New Zealand economy fell into its first recession in a decade in the first half of last year and many analysts believe it will continue into the middle of this year.
The Reserve Bank of New Zealand, which has slashed interest rates by a total of 325 basis points since last July, is expected to cut by a further 1 percentage point on Thursday to a record low 4 percent.
The survey, based on responses from more than 300 service sector companies, mirrors a long-established poll for manufacturing also conducted by Business NZ.
(Reporting by Gyles Beckford) Keywords: NEWZEALAND ECONOMY/SERVICES (gyles.beckford@reuters.com ; +64 4 471 4231; Reuters Messaging: gyles.beckford.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.