New Zealand Services Activity Swings to Expansion

New Zealand’s BusinessNZ Performance of Services Index eased to 50.9 in January 2026 from 51.7 in the prior month, reflecting subdued confidence as holiday closures and seasonal shutdowns slowed enquiries and extended the post-Christmas lull. High living and operating costs added further pressure. Still, the sector managed to stay in expansion for the first month of the year, following a prolonged period of contraction. Of the five sub-indices, two remained in growth: activity/sales (54.2 vs 52.5 in December), while new orders slipped (51.8 vs 52.7). In contrast, stocks fell after growing previously (49.7 vs 52.0), and employment weakened further (49.1 vs 49.6).

New Zealand’s BusinessNZ Performance of Services Index (PSI) rose to 51.5 in December 2025 from 46.9 in November, moving into expansion and ending the longest run of contraction since the survey began; the index remained below its long-term average of 52.8. Three of the five sub-indices were in expansion, with New Orders/Business (52.5) leading the way after four months of contraction, followed by Activity/Sales (52.2) and Stocks/Inventories (51.9), while Employment (49.6) remained in slight contraction. Despite the return to overall expansion, the share of negative comments eased to 50.4%, down from 52.9% in November and 54.1% in October. Respondents continued to cite weak demand and confidence, high living and operating costs and Christmas-related shutdowns as the primary factors weighing on services sector activity.

New Zealand’s BusinessNZ Performance of Services Index (PSI) declined to 46.9 in November 2025 from 48.4 in October, sinking deeper into contraction and marking its weakest reading in six months. The index remained well below its long-term average of 52.8. All five sub-indices were in contraction, with Activity/Sales (45.8) posting the sharpest deterioration, while New Orders/Business (49.3) edged slightly higher but remained below the breakeven level. Employment (46.4) also weakened from October. Despite the deeper contraction in November, the share of negative comments eased to 52.9%, down from 54.1% in October and 58.0% in September. Respondents continued to cite a challenging economic backdrop, pointing to weak consumer confidence, high living costs, inflation, elevated interest rates, and reduced discretionary spending as the primary factors weighing on services sector activity.