Cantometer shows lift in activity

Index suggests activity in Canterbury is above pre-earthquake levels. Photo / Greg Bowker

Economic activity in Canterbury is gathering pace, according to the January edition of the ASB Bank's Cantometer.

The Cantometer index showed activity in the Canterbury region lifted significantly last month, from 0.2 to 0.5, suggesting activity is now firmly above pre-earthquake levels. The index was re-based to zero in June 2010 - the end of the quarter immediately preceding the first earthquake.

A positive number represents activity being above pre-earthquake levels.

Construction activity continued to improve, boosted by an increase in non-residential consents, the bank said.

Increases in retail spending and consumer confidence suggested activity was broadening beyond construction, the bank's chief economist Nick Tuffley said in a commentary.

Statistics New Zealand's Christchurch retail trade indicator revealed further recovery in retail spending over the third quarter, with the quarterly pace of growth outpacing that of the rest of the country. In addition, there was a sharp improvement in Canterbury consumer confidence over the fourth quarter.

"The continued recovery in these areas suggests economic activity is starting to broaden beyond construction," Tuffley said.

However, the third quarter data released just before Christmas suggested there is less momentum in support industries - such as professional services - than previously thought.