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Relief in sight? Airfares decline slightly after months of huge increases

July 13, 2022
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2 min read
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Relief in sight? Airfares decline slightly after months of huge increases
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Good news: Despite soaring prices elsewhere in the economy, the price of airfare declined slightly between May and June.

The move follows significant increases in airfare for much of 2022.

On a seasonally-adjusted basis, the cost of airfare declined 1.8% between May and June, government inflation data released on Wednesday shows. That followed huge gains of 18.6% between March and April — when airfare was a leading driver of the consumer price index's increase — and 12.6% between April and May.

Still, airfare is considerably more expensive than it was a year ago: up 34.1% from June 2021 to June 2022, on an unadjusted basis.

While any decrease is sure to be welcome news for budget-conscious flyers, some of the June decline might just be a function of the time of year.

With summer travel already in full swing, travelers are starting to look at booking flights for the fall. Fall fares tend to be less expensive than summer fares, because leisure demand is lower in the fall. Further adding to downward pressure this fall is the partial — but not full — recovery of business travel.

"Demand for travel typically slows in June, as May and June see the highest demand for summer travel," Hopper's lead economist Hayley Berg wrote last month.

More: Why are airfare and hotel rooms so expensive right now?

The travel firm last month saw its first drop in airfare for all of 2022, in-line with this morning's CPI data.

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"Airfare remains 18% higher than 2019 prices today, but is trending downward in line with trends we typically see at this time of year," Berg wrote.

On the supply side, the high cost of jet fuel is also driving higher airfares, though the price of that has come down slightly in recent weeks.

Still, Delta Air Lines, which reported its second-quarter earnings on Wednesday, had a strong revenue forecast, even if airfares are coming down a bit.

"Looking forward, we are seeing demand and pricing strength carry into the late summer and fall as demand remains strong," Delta president Glen Hauenstein said during the carrier's earnings call.

David Slotnick contributed reporting.

Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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  • Some may have trouble using Uber and other dining credits
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  • $100 Resy Credit: Get up to $100 in statement credits each calendar year after you pay with the American Express® Gold Card to dine at U.S. Resy restaurants or make other eligible Resy purchases. That's up to $50 in statement credits semi-annually. Enrollment required.
  • $120 Dining Credit: Satisfy your cravings, sweet or savory, with the $120 Dining Credit. Earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, and Five Guys. Enrollment required.
  • Explore over 1,000 upscale hotels worldwide with The Hotel Collection and receive a $100 credit towards eligible charges* with every booking of two nights or more through AmexTravel.com. *Eligible charges vary by property.
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