The services sector is enjoying its longest period of expansion in seven years, as the falling Australian dollar gives tourism and consumer services a boost.
The Australian Industry Group’s Performance of Services Index (PSI) fell 3.4 points to 52.3 points in September, but still managed to stay above 50, showing that activity is rising at a slower pace.
Activity in the sector expanded for a fourth month in a row, its longest period of expansion since the global financial crisis.
Ai Group chief executive Innes Willox said the services sector’s resurgence is an encouraging sign for the economy.
“Local tourism, retail and other consumer services are noticing the benefits of the lower dollar offsetting the higher local currency prices of imported inputs,” he said.
Six of the nine sub-sectors grew in September, with finance and insurance, along with property and business services the strongest sub sectors.
“Still-buoyant housing market activity is clearly a factor in the growth of some sub-sectors and there is some early evidence that changes in the political environment may have supported consumer confidence and sales,” he said.