AIG Performance of Services index for January, 49.9
- prior was 47.5
- 11 straight months in contraction now
- Still in contraction, but only by the smallest margin possible
- High since August of last year
On Monday we got the AIG Performance of Manufacturing index for January at 49.0
More on the services PMI:
- Three of the five activity sub-indexes returned to expansion (i.e. above 50 points) in January, with the sales (up 2.6 points to 50.7), new orders (up 1.2 points to 50.7) and employment (up 6.4 points to 51.7) sub-indexes all ending several months of contraction
- However, services businesses reduced deliveries from suppliers (down 0.2 points to 46.6) and reduced their stock levels (down 1.3 points to 46.0) for an eighth consecutive month
- Only two of the nine services sub-sectors showed expansion – health & community services (up 2.5 points to 58.1) and finance and insurance services (up 11.2 points to 56.6) – while retail trade was stable at 50 points
Ai Group Chief Executive, Innes Willox:
- “The encouraging stabilisation in the performance of the sector puts it on the cusp of expansion as it enters 2015.
- In particular, the lift reported in sales, new orders and employment is a tentative sign of improved conditions in 2015 in this important part of the economy.
- However, with overall services sector performance driven by strong results from just two sub-sectors, evidence of a more widespread recovery across both consumer-oriented services and business-to-business services will be needed before we see the more sustained lift in performance that is required.
- With service sector businesses remaining concerned about weak local economic conditions and subdued consumer and business confidence, yesterday’s decision by the Reserve Bank to lower interest rates provides a timely boost to the outlook”
Not much of a response from the AUD … (but there rarely is to this survey result)
