WELLINGTON, Dec 20 (Reuters) - Activity in New Zealand's services sector picked up in November but only slightly, giving further evidence of the economy going through a slow patch, a survey showed on Monday.
The Bank of New Zealand-Business NZ's seasonally adjusted performance of services index (PSI) inched 0.2 points higher to 51.4 last month, after falling 3.9 points in October. The index has been above 50 since November last year, indicating expansion of the sector.
The survey was seen underlining the overall flat performance of the economy and the caution of consumers in the face of weak housing sales and prices, slow wage growth, and the emphasis on reducing household debt levels.
'A flat result should be read as a pause in the broader recovery process,' said Doug Steel, a Bank of New Zealand economist.
Two of the five sub-indexes -- sales and new orders -- were expanding, while the other three all declined and were at contractionary levels.
'The detail in the results indicates that economic growth will pick up into 2011. It's pleasing to see new orders leading the charge,' said Steel.
Domestic consumption makes up around 60 percent of the New Zealand economy, but activity has been patchy.
A survey last week also showed the manufacturing sector picked up for the first time in four months in November.
Recent data has shown patchy and uneven activity, which has prompted the central bank to hold interest rates since August and to say it wants signs of a sustained and robust recovery before it starts tightening. Analysts expect no rate rises before June next year.
The services survey, begun in April 2007, is based on responses from more than 300 services firms.
(Reporting by Gyles Beckford; editing by Balazs Koranyi) Keywords: NEWZEALAND ECONOMY/SERVICES (Gyles.Beckford@thomsonreuters.com)(+644-471-4231)(Reuters Messaging: gyles.beckford.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. 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 seasonally adjusted performance of services index (PSI) inched 0.2 points higher to 51.4 last month, after falling 3.9 points in October. The index has been above 50 since November last year, indicating expansion of the sector.
The survey was seen underlining the overall flat performance of the economy and the caution of consumers in the face of weak housing sales and prices, slow wage growth, and the emphasis on reducing household debt levels.
'A flat result should be read as a pause in the broader recovery process,' said Doug Steel, a Bank of New Zealand economist.
Two of the five sub-indexes -- sales and new orders -- were expanding, while the other three all declined and were at contractionary levels.
'The detail in the results indicates that economic growth will pick up into 2011. It's pleasing to see new orders leading the charge,' said Steel.
Domestic consumption makes up around 60 percent of the New Zealand economy, but activity has been patchy.
A survey last week also showed the manufacturing sector picked up for the first time in four months in November.
Recent data has shown patchy and uneven activity, which has prompted the central bank to hold interest rates since August and to say it wants signs of a sustained and robust recovery before it starts tightening. Analysts expect no rate rises before June next year.
The services survey, begun in April 2007, is based on responses from more than 300 services firms.
(Reporting by Gyles Beckford; editing by Balazs Koranyi) Keywords: NEWZEALAND ECONOMY/SERVICES (Gyles.Beckford@thomsonreuters.com)(+644-471-4231)(Reuters Messaging: gyles.beckford.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. 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.