Macau’s tourist price index, which reflects price changes in goods and services typically purchased by visitors, fell by 5.5 percent year-on-year in the first three months of 2017, data from the city’s Statistics and Census Service show. Gaming services are not included in the index.
It was the seventh consecutive quarter of such year-on-year decline, according to official data. The last time the index went up was in the second quarter of 2015.
The tourist price index for the first three months of 2017 was down 4.5 percent from a quarter earlier.
The decrease was partially attributable to lower hotel room prices, the statistics bureau said on Thursday. The sub-index for accommodation was down by 14.4 percent year-on-year. In quarter-on-quarter terms, the decline was of 10.2 percent.
The average cost of a Macau hotel room during the first two months of 2017 was MOP1,367 (US$171) per night, show data from the Macau Hotel Association. That was a fall of 2.6 percent from the prior-year period.
The decline in hotel room rates is occurring against a backdrop of increasing supply. At the end of February, Macau had 36,400 hotel rooms, up by 13.2 percent from a year earlier.
Many of the hotel rooms in Macau are in the five-star category. The high price of Macau hotel rooms is regularly cited by investment analysts as an inhibitor for extended stays or increased frequency of stay.
Contributing to last year’s increase in hotel room supply were two new casino properties in Cotai: Wynn Palace, inaugurated in August by Wynn Macau Ltd; and Parisian Macao, from Sands China Ltd, which opened doors in September. Hotel stays are one of the main non-gaming revenue sources for casino operators in Macau.
In the first two months of 2016, the city recorded a total of 2.0 million hotel guests, up by 11.9 percent in year-on-year terms. Visitor arrivals in the same period were up 5.5 percent to 5.4 million.
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”Given that the blanket casino closure [in Macau due to Typhoon Mangkhut] happened on an all-important weekend day… we expect that somewhere between MOP1.1 billion [US$136.2 million] and MOP1.5 billion in GGR will be lost”
Analyst at Union Gaming Securities Asia