Weekly bulletin 15 January 2024

Just over 2.2 million tourists departed from Leifsstöð International Airport in 2023, in line with our October forecast. In that same forecast, we anticipate 2.3 million tourists in 2024. The year 2023 is the second largest tourist year from the beginning, only topped by 2018, when 2.3 million travellers visited Iceland. This past year only just exceeded 2017, which was previously the second largest tourist year.

15 January 2024

The week ahead

On Tuesday, the Housing and Construction Authority (HMS) releases the housing price index for the capital area and the Central Bank (CBI) publishes payment card turnover.
On Wednesday, inflation figures will be published for the UK.

Image of the week

Just over 2.2 million tourists departed from Leifsstöð in 2023, in line with our October forecast. The travel industry gained momentum as 2023 progressed to become the second largest tourist year in Iceland. The year that has just begun could well become the largest tourist year yet. We forecast an equal number of tourists as in the record year 2018, or 2.3 million.

Highlights of the previous week

The Icelandic Tourist Board released data for December departures from Leifsstöð. In early 2023, tourist numbers were slightly under 2018 figures each month. As of June, figures were similar between these two years. In October and November, we saw higher numbers than in the same months of 2018 and in December, tourist numbers were similar to December 2018, despite volcanic and seismic activity on the Reykjanes peninsula. Figures from the Centre for Retail Studies, on foreign payment card turnover in Iceland, indicate that spending has not increased in line with increased tourist figures.
We published an inflation forecast for January on Thursday last week, based on price measurements by Statistics Iceland that week. We are of the opinion that inflation will recede between months, from 7.7% to 7.2%. January is a balancing act between tariff increases and sales. We forecast receding inflation in coming months, or 6.8% in February, up to 6.9% in March and down again to 5.7% in April.
Registered unemployment was 3.6% in December, up from 3.4% in November. Unemployment in December was 0.2 percentage points higher than in December the previous year. Unemployment fluctuates considerably between seasons, is highest in midwinter and lowest in summer. Changes should be considered between years rather than merely months.
Inflation in the US measured 3.4% in December, up from 3.1%. The measurement came as somewhat of a surprise, with most analysts having forecast 3.2% inflation. Equity prices fell following the release of these figures.
In the stock market, Hagar and Ölgerðin published results for the period 1 March to 30 November 2023. Icelandair and Play released December load figures.
In the bond market, Landsbankinn and Íslandsbanki auctioned covered bonds. Government Debt Management auctioned Treasuries notes and published Markaðsupplýsingar. The City of Reykjavík published its issue forecast for 2024.

Statistics and market data

Weekly bulletin 15 January 2024 (PDF in Icelandic)

Disclaimer

This review and/or summary is marketing material intended for information purposes and not for business purposes. This marketing material does not contain investment advice or independent investment analysis. The legal provisions that apply to financial advice and financial analysis do not apply to this content, including the ban on transactions prior to publication.

Information about the prices of domestic shares, bonds and/or indices is source from Nasdaq Iceland - the Stock Exchange. Landsbankinn’s website contains further information under each individual equity, bond class or index. Information about the prices of non-domestic financial instruments, indices and/or funds are sourced from parties Landsbankinn considers reliable. Past returns are not an indication of future returns.

Information about the past returns of Landsbréf funds is based on information from Landsbréf. Detailed information about the historic performance of individual funds is available on Landsbankinn’s website, including on returns for the past 5 years. Information about the past performance of funds show nominal returns, unless otherwise stated. If results are based on foreign currencies, returns may increase or decrease as a result of currency fluctuations. Past returns are not necessarily an indication of future returns.

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