17 Feb 2014

Growth in services sector

1:53 pm on 17 February 2014

The services sector continues to show strong growth, with some levels of activity at seven-year highs.

The Bank of New Zealand-Business New Zealand Performance of Services Index rose half a point to 58.1 - in January, the highest level of activity since November 2007. A reading about 50 indicates expansion.

The key sub-indices of new orders and business and activity and sales were also the highest since 2007.

BNZ senior economist Craig Ebert says new orders are driving the sector. "There's this juxtaposition between accelerating orders and falling inventory which to us signals surprising growth coming through."

Mr Ebert said the overall level is high, and consistent with strong, probably accelerating, GDP growth.