Forex▼ Bearish
Weak Hiring Weighs on NZ Services Recovery, RBNZ to Stay Cautious
NZ services PMI held at 50.6 in July, but employment at 48.5 signals a fragile recovery that could keep the RBNZ cautious on rate moves ahead.
Continue with
New Zealand's services sector held above the 50.0 breakeven line for a second straight month in July, with the Performance of Services Index (PSI) slipping to 50.6 from June's 50.9, BusinessNZ data showed Tuesday. The modest cooling offers limited fresh direction for the New Zealand dollar, with the real focus on the weak employment sub-index that, at 48.5, points to a recovery that remains narrowly based, BusinessNZ chief executive Katherine Rich said.
Rich told reporters it was encouraging to see the index hold above breakeven for a second month. She flagged employment and supplier deliveries, both at 48.5, as the sector's persistent soft spots. She said the recovery is likely to stay modest until consumer confidence firms up further. Respondent commentary painted a cautious picture. Cost of living pressures, fuel prices, rising interest rates, and election uncertainty were the most common concerns, with 64% of comments negative.