Figures released by PKF Hotel Consultancy Services show an increase of 6.2 per cent in the city's occupancy rates for July 2008 compared with the same period last year.

Commentators said the performance was buoyed by and international visitors travelling to the city for the World Corporate Games and domestic holidaymakers decided to spend their vacations closer to home.

The average room rate has increased by four per cent from £68.53 in 2007 to £71.30 in 2008 while the revenues made on each room has gone up from from 51.62 per cent to 57.04 per cent.

Leeds outperformed York, where occupancy growth rose by 2.6 per cent, and Sheffield, which reported losses of 9.4 per cent.

Robert Barnard, partner for Hotel Consultancy Services at PKF, said: "The strong figures mean that hotels in the city are defying the current UK economic (situation) which is not only good news for the hoteliers, but for the city's economy overall."

PKF, an accounting and business advisory firm, has been providing hotel consultancy services since the early 1970s. Its trend surveys tend to focus on chain hotels in the three to four star categories.