A good dollop of pre-Christmas cheer has emerged within some segments of the local services sector, Otago-Southland Employers Association chief executive John Scandrett says.
"Not all operators will be breaking out the Champagne but the regional November PSI at 60.8 points demonstrates that across selected sector activities, a marked improvement is being seen."
The latest Performance in Services Index, released yesterday, shows that Otago-Southland is the country's leading region, as it was with the manufacturing index released late last week.
The November result is well above the weak 34.4 September result and October's 43.7.
The national seasonally adjusted PSI was 56.6 points in November. Northern was an unadjusted 60.4 points, central was 59.9 and Canterbury-Westland was 56.7. A result above 50 indicates a sector in expansion and below 50 as one in decline.
Mr Scandrett said local survey comments supported a lift in corporate catering demand, a marginal improvement in tourist numbers and some references to a positive summer-season activities build-up.
Negativity was still evident in sections of the property and business services markets, in elements of the wholesale trade and within the construction industry.
"Since we have been tracking locally over recent months within a wide contraction band, we probably need to exercise a high degree of cautious optimism around this latest result.
"Hopefully, it does not represent a lone expansionary spike in the PSI and that we will, in this part of the country see a steady forward rebuild of the services sector," he said.
BNZ economist Doug Steel admitted feeling a bit nervous waiting for the latest PSI result as the October result was barely above the break-even line of 50 points.
"But as good as the November results look, we need to be careful not to over interpret the strength of one month, just as we were reluctant to get too downbeat on the dip in October."
The result fitted with a general theme running through the latter part of the year that few New Zealand data points were going to be indicative of underlying trends.
Events like the Rugby World Cup, the change in school holiday timing, recovery from earthquakes and the election were also going to make New Zealand's data flow choppy, he said.
Another decent bout of global uncertainty and good grass growing conditions had only added to the ambiguity.
