The improvement in the airline share price index was dominated by North America, with modest gains in Europe & Asia Pacific. However, airline shares are still lower than at the beginning of the year.
The financial monitor has also revealed that the initial Q2 2018 data point to a moderate squeeze on airline profitability compared to the same quarter a year ago. However, industry-wide cash flow generation increased in Q2 compared with the same period in 2017.
However, airline shares are still lower than at the beginning of the year.
Other points in the financial monitor are:
- Oil prices eased slightly again in July, but the upward trend remains in place. Jet fuel prices dipped back below US$90/bbl this month, but remain almost 40% higher than their level of a year ago.
- There are signs of renewed downward pressure on passenger yields. Yields in the less price-sensitive premium-class cabin have generally proven to be more resilient than the economy cabin, despite signs of weakness in May.
- Passenger demand carried solid momentum into the peak Northern Hemisphere summer period, but freight demand is showing signs of some moderation.