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The services sector has contracted for the first time in more than a year as the rate of new orders and sales softens.
The BNZ-Business New Zealand Performance of Services Index fell 4 points in April to 49.8, well below the long term average of 53.6.
A reading below 50 indicated contraction in the sector.
The rate of activity and sales saw the biggest decline of the sub-index results, falling 10.8 points from March to 45.1, while the rate of new orders and business fell 3.5 points.
BNZ senior economist Craig Ebert said the flat result was a slowdown from previous readings.
"While April's result denotes only a tiny fraction of contraction, the PSI has certainly slowed a lot, in the space of a month, to the point of a pause," he said.
BusinessNZ chief executive Kirk Hope said despite April's reading only just inching into negative territory, it could be a turning point for the sector.
"The fall into contraction for April was also mirrored by the movements in the proportion of negative comments, which increased again to 60.2 percent in April, compared to 58.6 percent in March and 51.9 percent in February," Hope said.
"A general lack of customer demand seemed to be the main thread common across the comments."
