Storm clouds gather over inbound travel to the U.S.

Travel-Trends-IndexTravel to and within the U.S. grew 1.6 per cent year-over-year in September, according to the U.S. Travel Association’s latest Travel Trends Index (TTI)- marking the industry’s 105th straight month of overall expansion.

But U.S. travel economists add several strong caveats to the overall positive trend.

Growth in domestic travel is levelling off, for example. That segment had been strong in recent months, buoyed by robust consumer spending and consumer confidence reaching heights last seen in 2000. Business travel, which registered a faster rate of growth than leisure travel in August, appears to have plateaued; domestic travel in September was almost entirely supported by leisure travel, which grew at a decelerated rate of 1.8 per cent.

It would also be easy to misconstrue the international component of the latest TTI, which showed 4.4 per cent year-over-year growth. But with inbound having posted a sharp 2.2 per cent drop in September of 2017, any year-over-year improvement at all is liable to appear over-inflated.

Furthermore, the international Leading Travel Index (LTI) predicts that the market will not expand any further at all in the next six months.

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“We’re seeing something of a perfect storm of factors that could suppress international demand for travel to the U.S.,” said U.S. Travel Senior Vice President for Research David Huether. “The U.S. dollar has been on another very robust strengthening trend since April of this year, while the global economy has been cooling off considerably overall. That, coupled with political uncertainty in Europe and rising trade tensions, is a bad-news recipe for inbound travel.”

Click here to read the full report.

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