DURHAM, New Hampshire—Economic research firm e-forecasting.com in conjunction with STR announced that their U.S. Hotel Industry Leading Indicator, or HIL, went up 0.3 percent during April, the third consecutive monthly increase after a slight dip in January's reading.
HIL is a monthly composite leading indicator for the U.S. hotel industry that, on average, leads the industry’s business activity four to five months in advance. The latest increase brought the index to a reading of 111.9. The index is set to equal 100 in 2000.
The metric’s six-month growth rate, which is a signal of turning points, went up by an annual rate of 8.7 percent in April, after going up 10 percent in March. This compares to a long-term annual growth rate of 3.5 percent, the same as the annual growth rate of the nation’s overall economic activity. At the deepest part of the recession during January 2009, the growth rate was down to negative 15.7 percent.
Four of the nine components that make up HIL had a positive contribution during April: Hotel Profitability; International Visitors Future Demand; New Orders for Manufactured Goods and Housing Activity.
Five of the nine components had a negative or zero contribution to HIL during April: Labor Market Tightness; Weekly Hours in Hotels; Interest Rate Spread; Oil Prices and National Vacation Barometer.
“Echoing the sentiment shared last month, although this is another monthly increase, we continue to see a decline in the six-month growth rate, which seems to have peaked at 13.7 percent in December," said Evangelos Simos, chief economist of e-forecasting.com. "Now that the slowdown in the six-month growth rate has occurred for four months in a row, it would appear that gains in industry will be slow but steady."
The U.S. Hotel Industry Leading Indicator, or HIL, is a monthly leading indicator that provides useful information about the future direction of the U.S. hotel 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, have led the industry four to five months in advance of a change in direction in the industry business cycle.