The Otago-Southland region languishes at the bottom of the BNZ Capital-Business New Zealand Performance of Services Index, but there are some encouraging signs.
Otago-Southland Employers Association John Scandrett said the July index reflected a "relatively stable" regional position at 43.7 points when compared with the June reading of 44.8 points.
"The last two months appear to present some positive movement against the disappointing May result at 37 points," he said.
In July last year, the Otago-Southland index was 55.9 points.
An index reading above 50 indicates industry expansion and below 50 a contraction in activity.
The national seasonally-adjusted index was 50.1 last month.
Northern was 51.2, central 45.8 and Canterbury-Westland 53.1.
Mr Scandrett said that within the index reporting framework, Otago-Southland had not exceeded 50 points since December last year.
"I will adopt some comfort that forward positive trending patterns are finally consolidating if, in the August and September results, we stay generally within the vicinity of this July figure," he said.
BNZ Capital economist Craig Ebert said that while the trends in the national index were encouraging, below the surface it was not all good news.
"There are still some regions languishing below the 50 mark, and some industry sectors - such as finance and hospitality - also need to pull upwards," he said.
