none

Services sector sluggish in August

07-09-2010
by 
in 

The services sector was sluggish in August with the gradual withdrawal of fiscal stimulus and the uncertainty surrounding the national political landscape continuing to impact on demand. 

The latest seasonally adjusted Australian Industry Group/Commonwealth Bank Australian Performance of Services Index (Australian PSI) rose slightly to 47.5 in August remaining below the critical 50 point level for the fourth consecutive month (readings below 50 indicate a contraction in activity).

The accommodation, cafes and restaurants sub-sector was flat in August while retail trade contracted once again. 

The expansion in activity in communication services, wholesale trade and finance and insurance, largely due to employment growth, wasn't enough to lift the sector's overall performance. 

A slump in supplier deliveries and selling prices particularly impacted personal and  recreational services and health and community services.

Australian Industry Group Chief Executive, Heather Ridout, said:  "The continuing sluggish performance of the services sector reinforces Ai Group's view of the ongoing patchiness of the recovery in the broader economy.  Although there are some promising signs among the services sub-sectors, the sector as a whole is yet to feel the full benefits of the gradual re-emergence of private sector demand."

Commonwealth Bank Senior Economist, John Peters, said: "The latest Australian PSI readings are consistent with the latest national accounts, which revealed retail spending by consumers (roughly 40 per cent of total household spending) edged up by just 0.3 per cent in the June quarter.

In contrast, the non-retail areas of household spending expanded by 2.3 per cent in the same period.

"We think that households, buoyed by ongoing labour market strength, a falling unemployment rate, and gifted with real wage increases, and likely rising asset prices in the year ahead, will become more confident and relaxed about the future. They will thus become increasingly less jittery about balance sheet repair, and will boost their spending levels and the breadth of their purchases," Mr Peters said 

Related news & editorials

  1. 15.02.2019
    15.02.2019
    by      In
    Honeywell’s new vehicle-mounted computer, the rugged Thor VM1A, is now available in Australia and New Zealand. Built for the company’s Mobility Edge platform, it helps forklift operators locate and move products quickly and efficiently throughout distribution centres.
    It runs on the Android... Read More
  2. 15.02.2019
    15.02.2019
    by      In
    Combilift’s Combi-PPT has been nominated as one of three finalists in the warehouse truck category of the international Intralogistics and Forklift Truck of the Year (IFOY) Award, one of the most prestigious and hotly contested international awards in the materials handling industry. From a large... Read More
  3. 14.02.2019
    14.02.2019
    by      In
    Schmalz is “raising the bar” for vacuum handling with the release of a system optimised for overhead handling tasks. The JumboFlex High-Stack can be used to ergonomically stack goods weighing up to 45kg to a height of up to 2.55m.
    Manually loading pallets with cardboard boxes or sacks is a tedious... Read More
  4. 11.02.2019
    11.02.2019
    by      In
    Interroll is set to unveil its novel modular plug-and-play solution for smart conveying at the LogiMat trade fair in Stuttgart, Germany.
    Billed as an enabling technology for Industry 4.0 adoption, the new DC platform comprises a range of coordinated motor rollers together with control systems and... Read More