Rising interest rates have not affected leisure travel on Qantas, the national carrier's chief executive says.
Qantas Airways Ltd CEO Alan Joyce said higher interest rates would be expected to have a negative effect upon discretionary spending and therefore impact leisure travel rather than business travel.
"(But) if you look at how robust the economy is, we are seeing very strong leisure demand despite interest rates having gone up," Mr Joyce told Sky Channel's Sunday Business program.
"We're still seeing the business market recovering because confidence is returning to the business sector, people are travelling again.
"So while we always have to keep an eye on the impact on discretionary expenditure, we're certainly not seeing any impact on our leisure traffic or on our business traffic as a consequence of that."
Mr Joyce said outbound tourism had been "pretty strong" given the strength of the Australian dollar.
The business market was "returning".
"We had expected the business market to return, and our intakes in terms of business traffic have been strong as we had been expecting," Mr Joyce said.
However, the United Kingdom and United States markets were still relatively weak.
"The UK market, with the economy there, will probably take a bit longer the recover," Mr Joyce said.
"The US market: there is some strength there. It's stronger than the UK but still weak relative to the pre-GFC (global financial crisis) level.
"But Qantas is comfortable that the improvements that we were expecting are occurring, and they are occurring at the rate that we were expecting."
In February, Qantas Airways reported its lowest first half net profit in at least a decade, did not pay an interim dividend and said its major overseas markets remained weak.
Qantas posted a $58 million net profit for the six months to December 31, down 72 per cent from $210 million in the prior corresponding period.
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