The
U.S. Federal Reserve this week in a report on economic conditions indicated
that travel and tourism activity during the past six weeks was
"strong" across many reporting districts, with hotel and convention
bookings continuing to "exceed last year's pace."
In
general, "overall economic activity continued to expand at a modest to
moderate pace in June and early July," according to the report, issued
Wednesday. "The Atlanta, St. Louis and San Francisco districts reported
modest growth, while Boston, Chicago, Minneapolis, Kansas City and Dallas
described economic activity as advancing moderately. The New York, Philadelphia
and Cleveland districts noted that activity continued to expand, but at a
slower pace since the last report, while Richmond cited mixed activity."
The
Fed conveyed general concerns on "the potential impact of economic and
financial stress abroad and the effect it could have on international travel."
It also noted that in the Richmond district, "corporate and military
travel had softened in part because of pending government actions affecting
spending decisions."
Overall,
however, the U.S. hotel industry remained strong. Occupancy rates and revenue
per room were "robust" in New York, Chicago, Atlanta and San
Francisco. In New York City, hotels indicated that revenue per available room
in May increased 6 percent to 7 percent year over year. "Very preliminary
figures for June suggest similar gains," according to the report. "This
gain reflects increased occupancy rates, which have been running above 90
percent, as well as 3 percent to 4 percent increases in average room
rates."
In
the Atlanta district, hotel occupancies and room rates increased from the
year-earlier period as "business travel remained strong and the outlook
among contacts was positive for the rest of the year." The district also
experienced "solid" convention bookings. "Concerns shared
earlier in the year regarding rising fuel costs and the potential impact on
travel and spending had abated," the Fed claimed.
In
Dallas, airlines reported "stable passenger demand over the past six weeks"
as domestic corporate and leisure travel "remained strong," according
to the report. But airlines, which reported higher airfares, "expect
passenger demand to soften in the fall and ramp back up over the holiday
season."
In
the Kansas City district, hotel owners "reported a sharp rise in occupancy
at higher average room rates and expected bookings to remain strong during the
next three months."