In general across hotel programs (Accor is really the only exception, but that's the most purely revenue rebate program out there: you redeem points for discounts from the revenue rate, period) the points reimbursement correlates to revpar on the particular night (which is more or less equivalent to occupancy times the average rate paid for that night). Basically, Hyatt sees the hotel averaged $X per room that night (counting vacant rooms as zero and ignoring out-of-order rooms) and settles up at something fairly close to that.

The point price is then intended to roughly correlate with what Hyatt expects to pay (probably targeting $0.007 to $0.01 per point overall, given that the minimum reimbursement is probably $20-30/night)) for a typical redemption at that property. It's Hyatt deciding the categories and levels that will best hit the target.

Thinking about earn rates at current valuations with top status and credit cards:

Hyatt (at 2 CPP): 5 base points + 1.5 Globalist bonus points + 4 Hyatt CC points = 10.5 points per dollar * 2 CPP = 21 cents per dollar

Marriott (at 0.8 CPP): 10 base points + 7.5 Titanium or Ambassador bonus points + 6 CC points = 23.5 points per dollar * 0.8 CPP = 18.8 cents per dollar

Hilton (at 0.5 CPP): 10 base points + 12 Diamond Reserve bonus points + 14 Aspire CC points = 36 points per dollar * 0.5 CPP = 18 cents per dollar

If Hyatt redemptions drop on average to 1.5 CPP:

10.5 points per dollar * 1.5 CPP = 15.75 cents per dollar

Assuming that CC earn rates are going to have the option to go up, a premium Hyatt card would need to earn (x+6.5)1.5=21 where x equals 7.5 points per dollar on Hyatt spend to maintain current earning rates. To match Marriott and Hilton, it would need to be 5.5 points per dollar on Hyatt CC spend.

If Hyatt points drop to a valuation of 1 CPP:

10.5 points per dollar * 1 CPP = 10.5 cents per dollar

The premium card would need to earn 14.5 points per dollar to maintain rates or 11.5 points per dollar to match Marriott and Hilton.

It's unlikely to change day to day, but the levels (but not categories) will probably be analyzed based on redemption behavior and adjusted several times a year.

tell you one thing - my Hyatt card spend goes to zero point zero, effective immediately. good luck pitching a premium card after this.

How does Hyatt compensate the hotels for point redemptions? At Marriott, the compensation is based on occupancy in which the hotel gets more if it's fully booked, so the hotels don't really care how many points the rooms are listed for.

Edit: Never mind, #91 answered my question

And just like that PH Paris has no base rooms for Points redemptions for months now despite being available yesterday...

You took the words right out of the horses mouth or in this case one of the Hyatt Ambassadors mouths
I haven't had time to close look at all these changes but from the surface its as if Marriott or Hilton is running the Hyatt program or bought Hyatt.
Forget about sugar coating this is an implosion of the program beyond inflation rationality.
Looks like I will have to keep moving business elsewhere more than expected.This makes the recent promotion near worthless

As a mostly cash-paying and leisure traveler, I don't mind these changes too much. I mostly burn the points I earn from the stays within 1-2 years of earning them. The devaluation hurts quite a bit, and the fact that this is a soft version of dynamic pricing isn't ideal either.

However, I joined Hyatt for the Globalist status and how ahead-of-the-curve it was compared to the other hotels' top-tier statuses. The now-proven fake rumors devalued Globalist by making it MUCH easier to achieve, which is why I was considering leaving the program. Why be a Globalist for a program that allows everyone to be Globalist (Hilton Diamond?)

While these changes are less than ideal, it seems to do two things:

• Potentially make availability at high-end properties easier to get. It's been impossibly hard to get reservations at some Park Hyatts, even with hundreds of thousands of points, due to how little availability there were.
• Make qualifying Globalists net-even, if not harder to achieve.

From a statusperspective, this means that Globalist status will (at least for now) not be diluted (if not made more valuable). While I'm keen to hear what else might come down the line, these changes don't bother me (personally) much

To confirm, Hyatt sets the point levels (the intra-category band) or the property sets it? Is Hyatt the one deciding on night minimums (such as at PH Kyoto)?

Yes funny how that works no coincidences possible are there

As others have stated, it may push people to use the Chase travel portal more whereby Chase gets a cut as a travel agent when you spend your points, which are on their books as a liability.

Don't be so sure of that. The Lodge at Spruce Peak in Vermont went up to a category 8 a few years ago. Cash prices are sky high and the hotel is as crowded as ever. We've been visiting that property for a solid 10 years now before it was even part of the Hyatt program.

I've been lamenting blowing thru our 250k point stash for upcoming stays in Japan. I never like seeing my balance that close to zero. But seeing the value I'll be getting now versus what the same redemptions will be in a few months makes me feel a bit better.

Hyatt pays the redemptions so I'd assume they set the points levels.

Are you saying that Hyatt or the property has taken away the rooms to wait for higher points payments? (what would be in it for the property?)

Or that all the rooms were booked up within hours of this announcement by members burning down their piles of Hyatt points?