Airline fares in the U.S. were down 1.3% in August compared to a year ago on an unadjusted basis. Overall, core inflation was up 3.2% year-over-year during the month, which matched the pace from July.

On a month-to-month comparison, airfares were up 3.9% in August after being down 1.6% in July and seeing a 5.0% drop in June, according to data compiled by the Bureau of Transportation Statistics. Air fares had dropped for five months in a row before the reversal in August. Looking ahead, booking app Hopper estimated domestic airfares for September will be down slightly compared to a year ago.

On Wall Street, Citigroup analysts Stephen Trent, Filipe Nielsen, and Jay Singh expect the potential for lower interest rates this fall will not only give a jolt to the stock market but be especially bullish for highly leveraged carriers like JetBlue and American Airlines, both of which could refinance debt and benefit from lower interest expense, especially JetBlue which carries 12% of its debt to a floating rate. A lower interest rate environment is also a plus for dividend payers like Delta and Panama’s Copa Airlines, appealing to yield-hungry investors as fixed income yields decline and the carriers’ net interest expense decreases.

In airline news this week, Southwest Airlines announced a significant refreshing of the company's board as part of the next phase of its transformation. The board presented its plans at a meeting on Monday and invited Elliott Investment Management L.P. to participate in refreshment efforts and other corporate governance changes. As part of the refresh, Executive Chairman Gary Kelly has announced his intention to voluntarily retire from the board and his Executive Chairman position. In addition, six current directors have informed the board of their plans to voluntarily step down immediately after the company's regularly scheduled board meeting.