{"id":477817,"date":"2026-06-15T03:59:15","date_gmt":"2026-06-15T03:59:15","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/477817\/"},"modified":"2026-06-15T03:59:15","modified_gmt":"2026-06-15T03:59:15","slug":"weak-sentiment-continues-to-weigh-for-new-zealands-services-sector","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/477817\/","title":{"rendered":"Weak sentiment continues to weigh for New Zealand&#8217;s services sector"},"content":{"rendered":"<p><img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/06\/4JODN0N_SMALL_BUSINESS_BUDGET_png.jpeg\" width=\"1050\" height=\"656\" alt=\"Budget Day 2026 (Replace text)\"\/><\/p>\n<p class=\"photo-captioned__information\">\nThe BNZ-Business New Zealand Performance of Services Index (PSI) Index fell 1.2 points in May to 47.5.<br \/>\nPhoto: RNZ\/Liam K. Swiggs\n<\/p>\n<p>The services sector &#8211; which makes up about three-quarters of economic activity &#8211; <a href=\"https:\/\/www.rnz.co.nz\/news\/business\/595548\/services-sector-contracts-again-in-april\" rel=\"nofollow noopener\" target=\"_blank\">had another month to forget<\/a>, as weak sentiment continues to weigh on activity.<\/p>\n<p>The BNZ-Business New Zealand Performance of Services Index (PSI) Index fell 1.2 points in May to 47.5 &#8211; a reading below 50 indicated the sector was in contraction.<\/p>\n<p>BNZ senior economist Doug Steel said it was weak across the board, with sales, new orders and employment all going backwards.<\/p>\n<p>&#8220;All major PSI components recorded a sub-50 reading in the month,&#8221; he said.<\/p>\n<p>&#8220;Activity\/sales and new orders were the most downbeat at 44.7 and 47.6 respectively, leaving these components furthest below their historical norms.&#8221;<\/p>\n<p>The outlook for employment continued to be poor.<\/p>\n<p>&#8220;The PSI employment index remains weak, posting its 30th consecutive month under 50, and consistent with our view that there is upward pressure on the unemployment rate.&#8221;<\/p>\n<p>Despite the <a href=\"https:\/\/www.rnz.co.nz\/news\/world\/598197\/live-peace-deal-reached-with-iran-donald-trump-says\" rel=\"nofollow noopener\" target=\"_blank\">news of a peace deal between Iran and the United States<\/a> on Monday, Steel said the latest PSI data was not a good sign for economic growth in the second quarter (the three months ending June 30th).<\/p>\n<p><img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/www.newsbeep.com\/nz\/wp-content\/uploads\/2026\/06\/4MJOI9A_image_crop_113171.jpeg\" width=\"576\" height=\"576\" alt=\"Katherine Rich\"\/><\/p>\n<p class=\"photo-captioned__information\">\nBusinessNZ chief executive Katherine Rich.<br \/>\nPhoto: Supplied\n<\/p>\n<p>&#8220;It&#8217;s shaping up that the second quarter of the year will be a very weak GDP number,&#8221; he said.<\/p>\n<p>&#8220;That&#8217;s in contrast to what we get this Thursday for the first quarter of the year, which is likely to look quite strong.&#8221;<\/p>\n<p>However, Steel expected confidence levels to improve after the news of the peace deal.<\/p>\n<p>BusinessNZ chief executive Katherine Rich said consumers were still wary of spending.<\/p>\n<p>&#8220;It is frustrating to see the services struggle, but it is difficult to see how the sector&#8217;s fortunes will turn around quickly,&#8221; Rich said.<\/p>\n<p>&#8220;The industries within the sector that were weakest in May were those, like cafes and restaurants and recreational and personal services, that rely heavily on discretionary expenditure by consumers.&#8221;<\/p>\n<p><a href=\"https:\/\/radionz.us6.list-manage.com\/subscribe?u=211a938dcf3e634ba2427dde9&amp;id=b3d362e693\" rel=\"nofollow noopener\" target=\"_blank\">Sign up for Ng\u0101 Pitopito K\u014drero<\/a>, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.<\/p>\n","protected":false},"excerpt":{"rendered":"The BNZ-Business New Zealand Performance of Services Index (PSI) Index fell 1.2 points in May to 47.5. Photo:&hellip;\n","protected":false},"author":2,"featured_media":469815,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[48,138,47,219,111,43,139,69,49,46,44,45],"class_list":["post-477817","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-audio","tag-business","tag-current-affairs","tag-economy","tag-new-zealand","tag-news","tag-newzealand","tag-nz","tag-podcasts","tag-public-radio","tag-radio-new-zealand","tag-rnz"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/477817","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=477817"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/477817\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/469815"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=477817"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=477817"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=477817"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}