18 Sep 2012

Services sector slowing down

8:48 am on 18 September 2012

An economist says slowing activity in the services sector could indicate that overall growth is stalling.

The BNZ-Business New Zealand performance of services index eased more than 2 points to a seasonally-adjusted 50 in August, its fourth consecutive monthly fall.

A reading at 50 indicates that the sector is neither expanding nor contracting.

BNZ is expecting a slight decline in June gross domestic product figures on Thursday, but is forecasting the economy will grow 0.7% in the three months to September.

Senior economist Craig Ebert says figures are volatile month to month, and it is hard to pick trends.

Last week, manufacturing activity contracted.

The GDP-weighted composite index, which combines the manufacturing and services surveys, fell two points to 49.6, the lowest level since July last year.