Every week we bring you the biggest business, travel and currency stories. This week: how the new US president has impacted tourism; Bitcoin is now worth more than gold; the pound fell as the service industry falters; EU inflation is up; and Americans may soon need a visa to travel in Europe.
Trump Slump
According to the US Travel Association, the US tourism industry is being affected by a “Trump Slump.” The new administration’s immigration policies have contributed to “mounting signs” that there will be “a broad chilling effect on demand for international travel to the United States.” Trump officials dispute the claim. NYC & Company, a travel agency, predicted 300,000 fewer international visitors to New York City in 2017 compared to the previous year.
Bitcoin Bump
On Thursday one unit of Bitcoin (a digital currency) exceeded the value of one ounce of gold. Gold closed at US$1,233 and Bitcoin at US$1,268. Much of the recent surge in demand for Bitcoin has come from China, where the cryptocurrency is being used to circumvent stringent financial restrictions. Beijing has made efforts to crack down on the currency and after some limited initial success, it has since rebounded and risen steadily.
Pound Down
In February the UK’s service industry fell to its lowest point in five months, despite an impressive end to last year. The UK’s economy should grow by 0.4% in Q1 of 2017. The news could mean trouble ahead for the UK and caused the GBP to fall 0.3% against the USD, and 0.5% against the EUR.
Inflation
Inflation in the eurozone hit 2%, up from 1.8% from the previous month. It is the highest rate since January 2013, and surpasses the European Central Bank’s target which is just below 2%. Despite this the ECB will not tweak its policies as the bump to 2% is the result of higher energy prices, and not greater economic performance. Eurozone unemployment remains at 9.6%.
End of Visa-free travel?
The European Parliament voted for a non-binding resolution to end visa-free travel by Americans in the EU. The motion is in response to the US’s decision not to provide Visa free travel to certain EU countries including Bulgaria, Croatia, Cyprus, Poland, and Romania. Canada (along with Japan and Australia) also restricted visa-free travel for certain European countries, but have agreed to end their bans thus avoiding retaliatory travel restrictions.
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