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flag New Zealand's services sector shrank in February 2026 due to weak demand, high costs, and global tensions, reversing a prior rebound.

flag New Zealand's services sector contracted in February 2026, with the BNZ Performance of Services Index falling to 48.0, below the 50 threshold indicating expansion. flag This marks a setback after a brief rebound, driven by weaker activity, sales, employment, and new orders. flag Poor weather and ongoing economic challenges, including high living costs, inflation, and interest rates, contributed to the downturn. flag Geopolitical tensions in the Middle East added to uncertainty. flag While manufacturing showed resilience, the services sector's recovery remains fragile, with revised growth forecasts now lower than expected.

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