National income and product accounts track airfares
As the summer travel season approaches, it’s time to consider options for vacations. If your plans involve traveling abroad, you’re likely watching how airfares are evolving. Overseas flights are considered exports and thus are tracked in the national income and product accounts (NIPA). Anything in NIPA usually has a price index attached, and the graph above shows that price index for three popular destinations. It should surprise no one that the prices seem quite volatile and that summer prices are higher—except, to our surprise, flights to Latin America: Flights there don’t exhibit seasonal patterns. We also note that, while there seems to have been a secular increase until 2012, prices have been trending down since. Also, there are important long-run differences between markets, with flights to Asia appearing to be under more price pressure than flights elsewhere. However, this graph won’t help you time your ticket purchases for this summer.
How this graph was created: Search for “air passenger fares,” check the series you want, click on “Add to Graph,” and limit the sample period to avoid the gap in the first years.
Suggested by Christian Zimmermann.
View on FRED, series used in this post: