Despite further decline in domestic business travel, the US Travel Association’s latest Travel Trends Index (TTI) indicates that travel to and within the US expanded overall in March, and predicts a moderate overall uptick in travel through mid-2016, thanks to solid domestic leisure travel demand and expected strengthening in international inbound visitation numbers.
The March Current Travel Index (CTI) registered 51.3 in March, showing overall growth in travel demand in March. The CTI has read above 50, indicating growth for 75 straight months.
After lagging behind domestic travel for much of 2015, international inbound travel to the US showed signs of life in March 2016 and is on track to pick up in the coming months.
The news is not nearly as good for domestic business travel, which continued its run in negative territory amid persistent uncertainty in international markets and the accompanying dip in global business confidence.
Travel to and within the US grew overall in March 2016, compared to March 2015, thanks to strengthening domestic leisure travel coupled with steady, though still subdued, growth in international travel. While the pace of international inbound travel trailed domestic for the ninth month in a row in March, the predictive 3-month Leading Travel Index (LTI) rose to 51.3 (a number greater than 50 indicates growth), indicating that international demand may soon pick up. U.S. Travel researchers project a bump in international arrivals in the near future, which is anticipated to grow slightly faster than overall domestic travel during the next three and six months.
“This month’s TTI readings signal that, despite the weight of the strong US dollar on foreign buying power, a rebound for international travel to the U.S. appears to be on the horizon,” said US Travel Association Senior Vice President for Research David Huether. “The continued softness of business travel is worth keeping an eye on, but for the moment is more than offset by strength in the rest of the travel market.”
The business Current Travel Index (CTI) plunged again in March from 49.6 to 48. As businesses remain cautious in the face of generally subdued business confidence and mixed global economic indicators, this segment of the US travel market will likely continue to underperform throughout the summer months.
The TTI consists of the Current Travel Index (CTI), which measures the number of person trips involving hotel stays and/or flights each month, and the Leading Travel Index (LTI), which measures the likely average pace and direction of business and leisure travel, both domestic and international inbound. It assigns a numeric score to every travel segment it examines—domestic and international, leisure and business—in current, 3-month predictive and 6-month predictive indicators. As with many indices similarly measuring industry performance, a score above 50 indicates growth, and a score below 50 indicates contraction.
In the full Travel Trends Index report, the 3-month and 6-month predictive Leading Travel Indices (which predict future industry performance) indicate a growth rate of around two percent, on average, through September 2016, with readings of 51.2 and 51.1, respectively.
The US Travel Association developed the TTI in partnership with Oxford Economics, and draws from multiple data sources to develop these monthly readings.