DURHAM, NEW HAMPSHIRE USA - Future business activity in U.S. hotels rose in August according to the latest reading of the Hotels' future business conditions (HIL) indicator. e-forecasting.com's HIL, a composite indicator that gauges future monthly overall business conditions in the U.S. hotel industry, increased by 0.7% in August to 118, following an increase of 0.3% in July. The index is set to equal 100 in 2005.
Looking at HIL's six-month growth rate, which has historically confirmed the forthcoming turning points in U.S. hotel business activity, posted a positive rate of 4% in August, following a positive rate of 3.3% in July. This compares to a long-term annual growth rate of 3%, the same as the 30-year average annual growth rate of the industry's gross domestic product.
The probability of the hotel industry entering into recession in the near-term, which is detected in real-time from HIL with the help of sophisticated statistical techniques, registered 7.1% in August, down from 9.1% reported in July. When this recession-warning gauge passes the threshold probability of 50% for a more than three months, the U.S. hotel industry will enter a recession phase in its business cycle.
"Led by a jump in the US vacation barometer, the leading indicator for hotel business activity increased for a third month in a row," said Maria Simos Sogard, CEO of e-forecasting.com.
Seven of the forward looking indicators of business activity that comprise Hotel Industry Leading (HIL) Indicator had a positive contribution to its change in August: Hotel Worker Hours; Foreign Demand; Yield Curve; New Orders; Oil Prices; Housing Activity and Vacation Barometer. Two indicators of future business activity had a negative or zero contribution to HIL's change in August: Jobs Market and Hotel Profitability.
"Given the recent performance of the hotel predictive analytics, the latest US Monthly Hotel Forecast predicts US online room rates to increase 6.9% in 2014 and 5.9% in 2015. This is a good outlook for US hoteliers as online sales - via online travel agent channels and brand websites - make one half of all sales," added Maria Sogard, CEO of eforecasting.com.
e-forecasting.com, an international economic research and consulting firm, offers forecasts of the economic environment using proprietary, real-time economic indicators to produce customized solutions for what’s next. eforecasting.com collaborates with domestic and international clients and publications to provide timely economic content for use as predictive intelligence to strengthen its clients' competitive advantage.
The US hotel industry leading indicator, or HIL for short, is a monthly leading indicator for the industry. Building off the tracking success of HIP, the real-time indicator for the U.S. hotel industry, HIL was built as a composite indicator that uses nine different components that, on average, when put together have led the industry four to five months in advance of a change in direction in the industry business cycle. HIL provides useful information about the future direction of the U.S. hotel industry.
