Monthly Economic and Financial Developments (MEFD) February 2024
Published: Tuesday April 2nd, 2024
Domestic Economic Developments
Overview
During February, preliminary indications are that the domestic economy’s momentum, though healthy, was moderated in comparison to the previous year, as the pace of growth continued to converge closer to its expected medium-term trajectory. Tourism sector activity maintained buoyancy, supported by robust gains in both the high-value air traffic and sea segments, reflective of sustained demand for travel in key source markets. Monetary sector developments in February were marked by a moderated build-up in banking sector liquidity, with growth in the deposit base, contrasting with the reduction in domestic credit. Likewise, external reserves increased, supported largely by net foreign currency inflows through the private sector.
Real Sector
Tourism
Initial data revealed that the tourism sector continued to register healthy gains during the review month, reflected in both the high-value air segment and the sea component, owing to the sustained demand for travel in key source markets and marketing efforts. Nevertheless, performance in the vacation rental market was contracted, after this segment outperformed hotel resort in the immediate period surrounding the pandemic.
Official data provided by the Ministry of Tourism showed that total visitor arrivals rose to 0.9 million in February 2024, from 0.8 million in the comparative period of 2023. Specifically, the sea segment increased by 11.4% to 0.8 million visitors, while the high value-added air component grew by 4.0% to 0.16 million visitors.
A breakdown by major port of entry revealed that total arrivals to New Providence advanced by 12.3% to 0.43 million visitors. Supporting this outcome, sea passengers rose by 16.2% to 0.31 million, while air traffic steadied at 0.12 million visitors. Further, foreign arrivals to the Family Islands expanded by 5.2% to 0.42 million, as sea and air passengers measured 0.39 million and 0.03 million, respectively. In addition, total arrivals to Grand Bahama edged up to 0.05 million, from 0.04 million in the prior year, as sea visitors totaled 48,677 million and air travelers 5,405.
On a year-to-date basis, total arrivals strengthened by 11.8% to 1.9 million. Underlying this outturn, air traffic grew by 5.1% to 0.30 million passengers, reflecting gains in all major source markets and, sea arrivals firmed by 13.0% to 1.5 million visitors.
The most recent data provided by the Nassau Airport Development Company Limited (NAD), showed that total departures—net of domestic passengers—grew by 8.5% to 132,256 in February, relative to the corresponding period of 2023. Specifically, U.S. departures increased by 9.5% to 111,366, while non-U.S. departures rose by 3.3% to 20,890 relative to the comparative period last year. On a year-to-date basis, outward-bound traffic expanded by 10.7% to 276,934. In particular, U.S. departures moved higher by 12.0% to 234,047, compared to the previous year. Likewise, non-U.S. departures advanced by 4.2 % to 42,887 vis-à-vis the same period last year.
As it relates to the short-term vacation rental market, the latest data provided by AirDNA showed that in February, total room nights sold reduced by 7.2% to 138,015 from a year earlier. Correspondingly, the occupancy rates for both entire place and hotel comparable listings decreased to 54.5% and 54.1%, respectively, from 66.3% and 63.6% in the prior year. Further, price indicators showed that year-over-year, the average daily room rate (ADR) for entire place listings and the ADR for hotel comparable listings declined by 5.0% to $506.96 and by 3.2% to $190.68, respectively.
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