Industry Report – Hotel & Tourism

However, the easing of the Australian dollar has been a get development. The latest Mastered-OTF sen clock timent survey indicates that international industry sentiment remains relatively stable. Notably, however, 50% of those surveyed proerb the Australian dollar as having a high impact on their business, highlighting the potential crest of the topical anesthetic currency easing. Growth In International visitor arrivals continues to Impress International visitor arrivals grew 4. 9% over the year to parade while International visitor nights grew 7. 2%, significantly outpacing average yield of the last decade. While this result has been largely led by the emerging Asian economies, particularly chinaw atomic number 18 which accounted for more than a third of total ripening in visitor arrivals, there has also been a sustained pick up in visitor arrivals from the US. Increasing length of stay by Nipponese visitors was also a key contri entirelyor to visitor night evolution. The observation post for international visitors remains plentiful Despite a marginally weaker economic mind-set, dolomite recover Economics continues to project solid ontogeny in international visitor arrivals and nights over the following(a) three historic period, with arrivals forecast to grow by 4. 5% p. A. ND nights by 4. 9% p. A. While the outlook for ripening in Chinese visitors has moderated slightly, China is expect to remain the single largest contributor to growth, with visitor nights forecast to grow by 6. 7% p. A. all over the next three years. Overall, Asia is projected to account for two thirds of forecast growth In International violators nights. In an load-bearing(a) sign for the nations larger regional tourism destinations, recent tr repeals take a leak revealed Chinese proceeders equatorial North Queensland are now frequented more commonly by Chinese leisure visitors than by international leisure travelers generally.The interior(prenominal) help visitor market entities to expand After a decade of weak or negative growth, the national tourism market rebounded strongly in the first half of 2012. While this rapid rate of growth has not been maintained, the domestic market has continued to expand, with visitor nights increasing 2. 2% over the year to meet 2013. Strengthening leisure market forecast to be the key driver of domestic growth inembodied travel has been the predominant driver of domestic tourism growth over the last decade.However a softer domestic economic outlook and signs of a continued pick-up in holiday travel indicate the leisure component playing a more reorient role in driving domestic tourism over the next few years particularly if the Australian dollar continues to recede. Holiday visitor nights grew 1 1. 6% in the March quarter and by 3. 7% over the year to March. This represents the fastest rate of growth since before the SGF and considerably narrowed the gap with outbound leisure travel, which gre w by 4. % over the same period. Overall, dolomite Access Economics forecasts domestic visitor nights to grow at an average rate of 1. 6% p. A. Over the next three years. Hotel occupancy place in Brisbane and Perth ease while mailer markets record strong growth In a clear sign that travel associated with the mining sector is slowing, the last two quarter saw a softening in occupancy rates in Brisbane and Perth with average occupancies for the year to may 2013 around 2% lower than the previous year. However, growth in domestic holiday travel has been unspoilt sensitives for destinations such as the Gold Coast where occupancy rates continue to improve, while Tropical North Queensland has benefited from strong growth in international visitor nights. A softer domestic economic outlook is moderating growth recasts for several major hotel markets Growth in occupancies and room rates in markets associated with mining-related corporate travel, such as Brisbane and Perth, is forecast to be more subdued, as the resource-related braid boom reaches its peak.At the same time, the weaken of the Australian dollar is forecast to provide further support for room rates and occupancies in leisure-oriented markets. Nevertheless, and contempt a strengthening investment pipeline, demand is forecast to outstrip supply and, accordingly, occupancy rates are forecast to grow 2% and room rates by 3. % p. A. Nationally over the three years to December 2015. Tourism and Hotel Market Outlook Half yearly update 2013 2 The macroeconomic scene with the US dollar since early 2011, the Australian dollar lost significant ground in whitethorn.By the end of May, the Australian dollar had fallen to IIS$O. 96, while the Trade Weighted Index (TWIT), which measures the strength of Australias currency against its handicraft partners, fell from 78. 2 on the 1st of May to 74. 0 by the end of the month. At the time of writing the Australian dollar had fallen to IIS$O. 92 and the TWIT had fa llen to 71. 2. The resist in the Australian dollar against its major trading partners was partly precipitated by the Reserve Banks decision in May to make out the official cash rate to 2. 5%, while an announcement by the Federal Reserve of a possible tapering of its quantitative easing strategy has caused a more recent drop against the US dollar. The decline in the Australian dollar is good news for local tourism operators. Previous Dolomite Access Economics research for Tourism Australia found that the value of the Australian dollar has a relatively grim impact on the decision to visit Australia. However, it has a more pronounced impact on the take of spending undertaken by visitors once they arrive, which is likely to be of greater importance for many tourism operators.The alleviation of the Australian dollar is also likely to further slow growth in outbound travel by Australians as the overcompensations of local destinations improves. Despite the pace of the recent moderatio n, the longer term outlook for the local currency remains relatively unchanged with the Australian dollar projected to remain at IIS$O. 80 from 2018-19. The global outlook The moderation of the Australian currency relative to the US dollar as been dictated in part by an improved outlook for the US economy.The most recent figures from the US hand over that real GAP grew by 0. 6% in the March quarter up from the 0. 1% enter in the December quarter. Over the year to March, US real GAP grew by 1. 8%. Moreover, the US housing market continues to strengthen, with the S&P Case Sheller 20-City Composite Home Price Index go up by 10. 9% over the year to March 2013 and housing approvals rising almost 21% since May 2012. Encouraging figures have also appeared from the US tug market, with the unemployment rate falling to 7. % in April (though it edged up to 7. % in May). However, looking beyond the headline data reveals a labor market which remains soft. This is particularly evident in t he employment to population ratio (capturing both unemployment and workforce participation), which remains essentially unchanged from the depths reached in late 2009. This data suggests that the falling unemployment rate has mainly been due to individuals dropping out of the labor force rather than strong employment growth.These emerging signs of recovery along with recent improvements in consumer sureness suggest that, although fiscal consolidation ill limit the speed of the nations economic recovery, the US is better determined than previously to handle the impact of $85 billion in budget cuts associated with the sequester and a 2% accession in payroll tax. By comparison, the outlook for Chinese growth is slightly weaker than forecast sextette months agone with growth falling from 7. 9% over the year to December 2012 to 7. 7% over the year to March 2013.Growth continues to be supported by infrastructure spending and housing construction with recent growth in real estate cos ts prompting renewed concerns rough the potential or a housing price bubble in China. Growth in both consumer spending and the longer term, China will use up to rebalanced its growth towards higher wages and increase consumer spending, which is likely to imply a slower but more balanced growth trajectory. The COED Economic Outlook forecasts Chinese growth to remain at 7. 8% in 2013, before rising to 8. 4% in 2014 on the back of an acceleration of global trade.In Europe, fiscal asceticism has continued to hamper growth with unemployment in the region climbing further. While austerity measures have increased the level of lattice instability in some member states, the European Central Banks actions in purchasing government bonds has reduced the risk of a severe collapse over the last eighteen months. The COED expects growth in the Euro area of in 2013 before recovering to 1 . 1% in 2014. By comparison, the outlook is slightly stronger for Japan as monetary easing has led to a depre ciation of the yen since November 2012, although the COED is call growth of only 1. % in 2013. On the whole, the global outlook remains broadly similar to six months ago, with more promising signs f recovery in the US being counterbalanced by a slightly softer outlook for Chinas economy and continued weakness in the Rezone. The domestic outlook In Australia, concerns have been growing about the capacity of the non-mining sectors to sustain growth once the resource-related construction boom peaks. The economy grew by 0. 6% in the March quarter to be up by 2. 5% over the year, but growth was largely driven by an improvement in net exports.A decline in new engineering construction in the quarter has prompted increasing concerns that the mining construction boom has begun to peak. While Dolomite Access Economics expects resource-related construction to plateau for some time before receding, alternative sources of growth moldiness be forthcoming if an economic slowdown is to be avoided. While there is evidence that housing construction and the retail sector are beginning to grow, the recovery in both sectors has been relatively mild to date. residential construction activity grew by only 2. % over the year to March, while retail expenditure grew by 3. 1% over the year to April. The decision by the Reserve Bank to cut interest rates to a record low of 2. 75% in May should act to Arthur stimulate the housing and retail sectors. At the same time, while the decision by the Federal government to delay a give-up the ghost to budget surplus to 2015-16 has been welcomed, indicators suggest business confidence has weakened in recent months due to concerns about the impending peak in construction activity in the resources sector.