Global airline share prices fell to levels not seen since two years ago.

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Airline profit margins are being squeezed further as a result of higher input costs in 2018, according to the International Air Transport Association's (IATA) latest Airlines Financial Monitor. 

The final financial results from Q3 show EBIT margins for IATA's sample of 97 airlines fell from 14.2% in 2017 to 10.7% last year. The decline was greater than year-on-year results from Q2.

Passenger yields continue to come under pressure as well, although yields in the less price-sensitive premium cabin have trended upwards recently which has allowed carrier to recover some of the pick-up in unit costs.

IATA said the underperformance of airline shares across last year was primely influenced by investor concerns regarding the impact of rising costs on airline financial performance.

Global airline share prices fell by almost 10% in December, hitting levels last seen two years ago. Shares have fallen 20% over the course of 2018, which is a reflection of the broader volatility in the global equity market.

IATA said the underperformance of airline shares across last year was primely influenced by investor concerns regarding the impact of rising costs on airline financial performance.

Industry-wide revenue passenger kilometers rose by 6.2% year-on-year in November, but freight volumes stopped growing as recent upwards trends have begun to moderate. 

Capacity has continued to outpace both passenger and freight demand in November, which has lead to falling load factors. 

IATA Director General and CEO Alexandre de Juniac said recently that the industry must take notice of the load factor figures as an indicator that tariffs and trade tensions across the world are taking their toll on the global economy including aviation.

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