US Leisure Travel Growth Slowing Into 2017

Domestic U.S. leisure travel volume is still growing, but the pace of growth has slowed. The U.S. Travel Association’s current travel index dropped from 52.2 in August to 51.9 in September and, according to Tuesday’s announcement, to 51.6 in October

October marks the 82nd consecutive month that travel has expanded, based on the association’s current travel index. An index score above 50 indicates expansion, and the six-month moving average index score is 51.8.

Domestic travel slipped to an index score of 51.6. International travel improved slightly over its six-month average to 51.7. The business travel index score declined by 2.5 points month over month from 52.0 in September to 49.5, and the leisure travel index rose by a point to 52.7.

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The U.S. Travel Association commented on domestic travel for the months ahead:

Domestic leisure travel will likely continue to lead the U.S. travel market, though at a decelerating pace, as leisure-related forward-looking travel bookings and vacation intentions slow. After outperforming domestic leisure in September, domestic business travel declined in October. This is due in part to the shift of Rosh Hashanah and Yom Kippur to this month from September, which contributed to a decline in group travel from last year.

International inbound travel to the United States remained positive in October 2016, growing at a rate slightly above its 6 month average. However, the [leisure travel index] indicates that international travel through the early months of 2017 will remain quite sluggish—and possibly decline—due in part to the stronger dollar.

The Association also cited Adam Sacks, of the Oxford Tourism Economics group:

Domestic leisure travel leads the charge once again, as business travel dipped in October due to a shift of the Jewish holidays, resulting in less group business travel. Expect a conservative path ahead for businesses leading into the new year, as there is no shortage of uncertainty regarding the President-elect’s policy strategy. The labor market remains strong, though as it matures, it will likely temper the pace of consumer spending, leading to a softening of domestic leisure travel. Muted international travel growth endures, as the dollar remains strong and political unrest lingers.

For more data and the methodology employed in constructing the indexes see the association’s website.

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