New Zealand’s services sector maintained its expansion in July, with the seasonally adjusted BusinessNZ Performance of Services Index (PSI) holding at 50.6, unchanged from June, according to BusinessNZ. A reading above 50 indicates expansion, and the index has now stayed above that threshold for a third consecutive month, signaling modest but sustained growth.
Among the five PSI sub-indices, new orders, a leading indicator of future activity, remained positive although growth eased slightly. Employment stayed in expansion territory, while activity/sales and supplier deliveries also contributed positively. Stocks of finished goods contracted, which BusinessNZ said may indicate that demand is absorbing inventory.
Separately, Statistics New Zealand reported that electronic card retail sales rose 1.3% in July, rebounding from a revised -1.4% decline in June. The monthly improvement points to a modest recovery in consumer spending, though annual growth remains subdued amid cost-of-living pressures. Economists cautioned that one month’s rebound does not confirm a sustained trend.
The data will be watched by the Reserve Bank of New Zealand as it balances inflation control with supporting economic growth. For financial markets, the releases offer a cautiously positive but limited signal on New Zealand’s economic momentum, with high interest rates and elevated living costs still weighing on household budgets.
