“Tradegy impact” The United States economy is at risk of losing billions due to a decrease in travel demand, according to analysts

According to analysts, the U.S. economy may lose billions of dollars this year as the Trump administration’s trade policy has a detrimental impact on consumer sentiment, as evidenced by the dismal earnings forecasts of travel-related companies, which are indicative of a decline in travel demand.
In a note published last week, J.P. Morgan suggested that a decrease in international tourism, which is classified as a service export, may be the result of anti-American sentiment.

Goldman Sachs and J.P. Morgan anticipated that reduced foreign travel expenditure would reduce U.S. GDP by 0.1% this year. They also suggested that the impact could be as high as 0.2% to 0.3%.

According to LSEG data, the U.S. GDP is $23.53 trillion as of the first quarter of 2025. Reuters’ calculations suggest that the impact could range from $23 billion to $71 billion.
Delta Air Lines (DAL.N), a major international carrier, issued a warning last month that travel demand has “largely stalled,” resulting in the cancellation of its projections for the year.

The trade war has resulted in the industry’s greatest uncertainty since the COVID-19 pandemic, prompting Southwest Airlines (LUV.N), American Airlines (AAL.O), Alaska Air (ALK.N), and Frontier (ULCC.O) to withdraw their guidance. United Airlines (UAL.O) issued two distinct forecasts.

Airbnb (ABNB.O), a vacation rental platform, has forecasted second-quarter revenue that is substantially lower than Wall Street estimates. Hilton (HLT.N), a hotel operator, has indicated that travelers are in a “wait-and-see” mode.

“Global perceptions of the United States have been adversely affected by tariff announcements and a more assertive approach to historical allies.” At a time when Europeans were already scheduling fewer trips to the country, Goldman Sachs stated in March that the more significant issue is a decline in tourist visits to the U.S.
Global consumers have also boycotted and abandoned U.S. products and brands as a result of President Donald Trump’s unpredictable tariffs.
J.P. Morgan estimates that foreign travelers and visitors spent $215 billion, or 0.7%, of the United States’ GDP in 2024.
The brokerage further stated that a 10% decrease in expenditure would result in a direct 7-basis point decrease in the United States’ gross domestic product.