One of the world's most profitable airlines, Cathay Pacific, saw a fall in profit in the first half of the year. The Hong Kong carrier said profit dropped six percent to $215 million from a year ago. The company blamed rising oil costs for the decline.
Cathay is not alone in feeling the pinch from a rising fuel bill. Korean Air reported a $42 million loss in the three months ending in June despite higher passenger traffic.
Most airlines have already passed a fraction of oil costs to passengers in the form of extra charges on their tickets. Cathay Pacific Chairman David Turnbull says if the trend continues, airlines could see a drop in passengers. "If the [ticket] price is to continue to rise, I think we'll find that demand will fall," he said.
In other airlines news, the president of Thai Airways has been suspended because of alleged financial mismanagement. The national carrier is expected to report a loss for the quarter that ended June 30, but airline officials gave no details of how big the loss will be.
For the first time since it revalued the yuan last month, China's central bank has unveiled the components of the basket of currencies that determine the value of its currency. The People's Bank of China says the main currencies in that basket are the U.S. dollar, the Japanese yen, the euro and the South Korean won, representing China's primary trading partners.
The currency mix also includes the British pound, the Singapore dollar, Malaysian ringgit, the Australian and Canadian dollars, Russian ruble and Thai baht. Chinese officials, however, did not reveal the exact weighting of each currency in the basket, nor how it will be calculated.
In Singapore, Creative Technology suffered a $32 million loss in the three months ending in June as it tried to challenge U.S. computer icon, Apple, in the growing MP3 player market.
Creative's Zen MP3 player competes with Apple's Ipod, but the company says sales fell short of target and unit prices have dropped from last year.