Hawaii General Fund Tax Revenue Forecast

Additional Factors (Cont.) The Fed is expected to raise interest rates this summer. If they do, it will be an encouraging sign that the U.S. economy is improving. The consequences for Hawaii are ambiguous, however, because higher interest rates would tend to strengthen the dollar in foreign currency markets. • A stronger dollar may hurt foreign tourism in Hawaii, i.e., making Hawaii travel more expensive, and may curb the gains from increased domestic visitors. Figure 2 shows what has happened to visitor expenditures in Hawaii in recent years.

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