DOMESTIC tourism will come under more pressure with the Aussie dollar – once dubbed the ‘Pacific Peso’ – tipped to reach parity with the US dollar due to strong local and regional economies plus rising interest rates. National Australia Bank economist John Kyriakopoulous believes parity will be reached by the end of March for the first time since 1982.
JP Morgan senior economist Helen Kavans expects the Aussie dollar will reach $US1.02, representing a double-edged sword for the local travel industry. Outbound will continue to power ahead at the expense of domestic tourism while inbound will become an increasingly harder sell. This demand dampener may also put the put the brakes on a hotel rates revival. Meanwhile, Tourism Queensland is spending $7m to stimulate tourism. Most is going to the domestic market with China ($1m) and New Zealand ($700,000) the main international targets.