You are using an older browser version. Please use a supported version for the best MSN experience.

Service sector activity stable in October

AAP logoAAP 2/11/2016

Gentle growth in sales, new orders and jobs have pushed service sector activity into slight expansion after two months of contraction.

The Australian Industry Group's Performance of Services Index (PSI) rose 1.6 points to 50.5 points in October, rising above the 50 point level signifying expansion.

"The Australian PSI for October indicates a weak though welcome lift out of the short-lived contraction of August and September," Ai Group chief executive Innes Willox said.

"Conditions remain fragile with gentle growth in sales and new orders and a healthy lift in employment countered by falls in stocks and deliveries. Conditions in the sub-sectors of the services industry also were mixed indicating there is plenty of room for expansion and next to no threat of inflation coming from the services sector in the next few months."

Three of the five activity sub-indexes expanded in October with employment up up 8.6 points to 52.9 points, sales were at 51.1 points and new orders were at 52.3 points.

Four of the nine services sub-sectors were stable, including health and community services, personal and recreational services, wholesale trade, and finance and insurance.

Communications services fell into contraction while retail trade, property and business services continued to contract but at a slower rate.

Input prices rose and at a faster rate in October, while wages increased for a third straight month and selling price returned to expansion.

image beaconimage beaconimage beacon