There are some contradictory signs out there. Our travel customers at Barclays say 2017 was a decent year for most of them; many saw single-digit sales growth and remained profitable despite pressure on margins. On the other hand, Barclaycard research shows that confidence in household finances fell from 64% to 56% in November as inflation and the first interest rate rise in a decade weighed on sentiment.

Travel agent spend was up 3.6% year-on-year in November overall, but this was driven by a 12.3% rise in online compared with a 5.5% fall in store. The proportion of respondents who intend to increase spend on holidays has stayed fairly stable over recent months at 15% in October and 16% in November.

The airline sector is intriguing, with strong profitability from the likes of easyJet, Ryanair and British Airways, in contrast with several high-profile failures recently, including Monarch. Interestingly, airlines posted a record high growth of 10.9% in spending data in October followed by a 2.8% fall in November, so we will continue to watch this space.

The outlook for M&A activity in the travel sector remains strong on the back of several deals with impressive sale values/profit multiples in 2017, including the Travelopia sale a few months ago and Riviera Travel in December.

Other high-profile travel firms have also been mentioned in the press recently as potential sale targets in 2018, and I believe further consolidation in the business travel market is likely, which may include top 10 or 20 TMC players. There seems to have been some movement in the Brexit talks over the past few weeks, and this factor does not seem to be diluting interest in the sector, particularly in companies where there is scope for international expansion.

The Payment Services Directive 2 changes will be important, and I have a feeling many travel companies are still undecided on their medium and long-term strategy and will watch the competition closely in a bid to give themselves the best chance to make the right strategic pricing move.

Barclays’ travel customers in the luxury, adventure and activity sub-sectors are generally trading strongly and the 50-plus market remains buoyant, with some element of protection from economic factors for these holidaymakers, possibly in part as a result of house price growth over the past decade or two and valuable pension pots for some.

Although the Barclaycard research found that the recent modest rise in interest rates, with the possibility of more to come, has made 24% of people less likely to spend on non-essentials, a large number of UK consumers still view their annual holiday as “essential” and are likely to continue to prioritise it, so I am optimistic 2018 will be a solid year for the best and most innovative travel companies.

Chris Lee is director, head of travel and professional sports at Barclays Corporate Banking