I cancelled a reservation at a guest's request and it is negatively affecting my host rating.
After making a booking, a guest revealed that they were planning on hosting an event for 30 people at my house and I replied that I could not accept this. They subsequently said that they didn't need the booking anymore so I cancelled it. The reservation was for October 7-10, 2017 and the cancellation occured on Mar. 24 so it was well outside the cancellation threshold. This should not be affecting my response rate.
@Terence8 This cancellation does not affect your Response Rating - this cancellation affects your Committment Rating.
For future reference, if you can no longer host a guest because their reservation doesn't meet the requirements of your listing. (I.E. your listing says no parties/events and they want to have one) you should Contact Airbnb directly so they can cancel the reservation without penalty.