New Zealand’s services sector contracted for the second consecutive month in March 2025, with the BusinessNZ Performance of Services Index (PSI) rising slightly to 49.1 from 49.0 in February—still below the neutral 50 mark and well under the long-term average of 53.
BusinessNZ CEO Katherine Rich noted the sector briefly moved into modest expansion in January before slipping back into contraction.
Among sub-indices, Activity/Sales fell to 47.4, while New Orders/Business rose to 50.8, its highest since February 2024.
Employment improved to 50.2, ending 15 months of contraction.
Negative business sentiment eased slightly, with 56.7% of comments in March reflecting concern—down from 57.8% in February.
Key pressures included economic uncertainty, high interest rates, inflation, and weak consumer confidence, alongside global tariffs, rising costs, and seasonal or weather-related impacts.