Tourism is one of those industries that is heavily exposed to movements in the Aussie dollar. When it is low international tourists find it cheap to travel here, and locals are also incentivised to holiday in Australia because it is expensive to head overseas.
Likewise over the past 6 or 7 years the Aussie dollar has been relatively strong which has hurt inbound international tourism and led a lot of Australians holidaying overseas.
But even though that fall in the dollar has yet to slow the flow of outbound Australians it seems that the fall of 14 cents over the past year or so against the US dollar is certainly helping sentiment in the international tourist sector. Today saw the release of the Tourism & Transport Forum (TTF)-Mastercard International Performance Sentiment Index which is sitting at 124 – its highest level since the GFC – while the “actual”, which could be compared to conditions as opposed to confidence in the NAB Business survey, is also at a post-GFC high of 139.
The RBA has already suggested in the Minutes to this month’s board meeting that monetary policy is working and while the Aussie dollar might still be high by historical standards its fall looks like a boon to inbound tourism.