Confidence beginning to grow in travel sectors

Travel, transportation and haulage firms, such as an airline or a truck trader, are a good indicator of the state of the economy as a whole. Air travel is rapidly affected by economic declines, and this was the case in the recession of the last two years, as airlines lost billions of Euros, as both individuals and businesses tightened their belts and refrained from flying. Likewise, when the numbers of these transportation industries begin to pick up, it tends to indicate that the economic climate is improving. The airlines have reported that it has almost returned to the pre-recession numbers, with Asia in particular driving the growth. China, the primary growth economy of Asia, and indeed the world, is vitally important, and although the government has begun to shrink some of the incentives and stimulus offers that were introduced in the face of the global recession, it still continues to grow in terms of its demand for equipment and products. Europe presents a less rosy picture, where the levels of growth are sluggish, and many governments have introduced so called 'austerity' policies in order to cut public deficits.

The industry continues to recover faster-than-expected but with sharp regional differences, said Giovanni Bisignani, Director General of IATA, Business confidence remains high and there is no indication that the recovery will stall any time soon. But, with government stimulus packages tailing off and restocking largely completed, we do expect some slowing over the months ahead.

The IATA said that air freight had grown by 26.5 percent, which points to a general increase in business. The world's largest steel-maker, ArcelorMittal, posted quarterly profits of €1.31 billion, which was a surprising level of growth, considering the figures for the commensurate period last year recorded a loss of more than €600 million. The reason for their 43 percent increase this quarter from the first can be accounted for by the return to profit of automobile groups. PSA Peugeot Citroen reported earnings of €680 million in the first half of the year, compared to a loss of €962 million in the first half of last year. Truck manufacturers are also superb indicators of the economic state of nearly every sector, and both Scania trucks for sale and Volvo trucks have been reported as being surprisingly robust. In Germany, the largest market in the EU, confidence in business rose remarkably, with the IFO Institute, a Munich based organisation, said, Firms are reporting significantly more favourable business conditions. The German economy is in party mood again.