ID :
137213
Wed, 08/11/2010 - 18:52
Auther :
Shortlink :
http://m.oananews.org//node/137213
The shortlink copeid
Air fares rise to highest levels in year
Domestic air fares rose to their highest levels in more than a year, with discount
fares up more than five per cent in August.
The increase comes as lending figures fell to their lowest levels in almost five
years while consumer sentiment improved.
CommSec economist Craig James said the airlines' decision to lift domestic airfares
in the hope of clawing back some of their shrinking margins could best be described
as "courageous".
"But with both consumers and businesses scouring for the best fares on offer, the
key question is whether the higher fares will stick?," Mr James said.
"While discount fares are still lower than a year ago, business and full economy
class fares are higher by almost six per cent, the strongest lift in prices for over
a year."
Figures from the Bureau of Transport and Regional Economics show discount airfares
rose by 5.6 per cent in August with business class fares up 3.0 per cent, full
economy rose by 1.9 per cent and restricted economy fares were up 0.4 per cent.
Meanwhile, total personal finance commitments rose 1.2 per cent in June, seasonally
adjusted, to $6.896 billion, up from $6.814 billion in May, the Australian Bureau of
Statistics (ABS) said on Wednesday.
Total commercial finance fell 8.9 per cent in June and lease finance was down 6.0
per cent.
Mr James said people's reluctance to take on debt was likely to be reflected in
continued weak spending figures in coming months.
"It goes to show that just because you are generally happy with your lot, it doesn't
mean that you're ready to go on a spending or borrowing spree," Mr James said.
"We need to see a few more months of stable interest rates before consumers are
tempted to part with their cash again.
"The global mood of conservatism is pervasive. Debt is out, saving is in."
Consumer confidence surged in August, with the Westpac-Melbourne Institute consumer
sentiment index rising 5.4 per cent in August to 119.2 points.
The survey was above 100 points, which indicates there were more optimists about the
economy than pessimists.
fares up more than five per cent in August.
The increase comes as lending figures fell to their lowest levels in almost five
years while consumer sentiment improved.
CommSec economist Craig James said the airlines' decision to lift domestic airfares
in the hope of clawing back some of their shrinking margins could best be described
as "courageous".
"But with both consumers and businesses scouring for the best fares on offer, the
key question is whether the higher fares will stick?," Mr James said.
"While discount fares are still lower than a year ago, business and full economy
class fares are higher by almost six per cent, the strongest lift in prices for over
a year."
Figures from the Bureau of Transport and Regional Economics show discount airfares
rose by 5.6 per cent in August with business class fares up 3.0 per cent, full
economy rose by 1.9 per cent and restricted economy fares were up 0.4 per cent.
Meanwhile, total personal finance commitments rose 1.2 per cent in June, seasonally
adjusted, to $6.896 billion, up from $6.814 billion in May, the Australian Bureau of
Statistics (ABS) said on Wednesday.
Total commercial finance fell 8.9 per cent in June and lease finance was down 6.0
per cent.
Mr James said people's reluctance to take on debt was likely to be reflected in
continued weak spending figures in coming months.
"It goes to show that just because you are generally happy with your lot, it doesn't
mean that you're ready to go on a spending or borrowing spree," Mr James said.
"We need to see a few more months of stable interest rates before consumers are
tempted to part with their cash again.
"The global mood of conservatism is pervasive. Debt is out, saving is in."
Consumer confidence surged in August, with the Westpac-Melbourne Institute consumer
sentiment index rising 5.4 per cent in August to 119.2 points.
The survey was above 100 points, which indicates there were more optimists about the
economy than pessimists.
