From the desks of the Hotel News Now editorial staff:
- Economy appears strong as Fed raises rates again
- Brexit, scarcity of opportunity occupies first day of Hot.E
- China settling in for trade war with US
- US jobless claims rise, particularly in states hit by Florence
- STR: US, Canada weekly results
Economy appears strong as Fed raises rates again: For the third time this year, the Federal Reserve unanimously agreed to raise the federal funds rate to between 2% and 2.25%, according to CNN Money. The decision is a sign of increased confidence in the United States economy as unemployment remains low, economic growth is strong and inflation is steady.
Central bankers are expecting a fourth rate increase in December, the news outlet reports. And Fed officials expect that at least three rate hikes in 2019 will be needed, along with one in 2020.
“Our economy is strong,” Chairman of the Federal Reserve Jerome Powell said in a press conference Wednesday. “These rates remain low, and my colleagues and I believe that this gradual returning to normal is helping to sustain this strong economy.”
Brexit, scarcity of opportunity occupies first day of Hot.E: Investors and hoteliers are optimistic about European trading, operations, ownership and demand, however opportunities are scarcer as concerns surrounding Brexit aren’t dissipating, writes Hotel News Now’s Terence Baker at the Hotel Investment in Europe Conference.
Neville de Melo, SVP of acquisitions at Realstar Group, said as the March deadline for Brexit approaches with no deal seemingly forthcoming, no one is clear on what will happen.
“Everyday (Brexit) changes. It moves everywhere, and it might run up to March, and then someone might work it all out, or extend (the leaving date),” De Melo said.
China settling in for trade war with U.S.: On Wednesday, the Chinese government announced the country would cut import tariffs on several goods such as textiles, construction equipment and more than 1,500 others on 1 November, Business Insider reports.
This latest move indicates that the Chinese government is “digging in and expects the trade war with the U.S. to last for some time,” the article states. Other signs of an extended trade war come from China backing away from trade talks with the U.S. after President Donald Trump’s last round of tariffs. The U.S. is “already threatening another round of restrictions,” according to the story by Business Insider.
A senior fellow at the Council on Foreign Relations told the news outlet that China’s latest move shows the country is trying to alter economic conditions. He said cutting tariffs on intermediate goods helps the competitiveness of Chinese companies.
U.S. jobless claims rise, particularly in states hit by Florence: Bloomberg reports filings for U.S. unemployment benefits increased last week, driven largely by a surge in claims in states hit by Hurricane Florence. The Labor Department recorded about 10,000 filings in North Carolina and nearly 3,400 in South Carolina—both of which are dealing with flooding from the storm.
Despite the jump, the national figure remains the lowest it has been in almost five decades, the news outlet reports. The spike is expected to be temporary, similar to the aftermath following Hurricane Harvey and Hurricane Irma in 2017.
STR: U.S., Canada weekly results: The U.S. hotel industry during the week of 16-22 September reported mostly negative results in the three key performance metrics, according to data from STR, the parent company of HNN.
Occupancy dropped 2.3% to 69.9%, average daily rate remained flat at $128.33 and revenue per available room fell 2.3% to $89.67. Several major markets in Florida recorded steep declines in year-over-year comparisons with the period of post-Hurricane Irma in 2017.
During the same week, the Canadian hotel industry reported positive year-over-year results, STR data shows. Occupancy rose 0.9% to 79.7%, ADR grew 4.8% to 174.16 Canadian dollars ($133.28) and RevPAR increased 5.8% to CA$138.83 ($106.25).
Compiled by Dana Miller.