Hello and welcome to our continued coverage of the global economy, financial markets, euro area and business.
The resumption of UK travel has started, according to Heathrow Airport, which reported its busiest month since the start of the pandemic – despite remaining ‘travel barriers’.
More than 1.5 million passengers passed through its terminals in July, up 75% from a year earlier, following the relaxation of travel restrictions.
But … it’s still more than 80% lower than in July 2019 – when 7.75 million customers traveled to Heathrow in a generally busy pre-pandemic summer month.
Heathrow says the ‘long road to recovery’ has begun:
The loosening of the rules has given a much needed boost to the UK travel industry and has allowed people across Britain to look forward to a more normal summer reunion with family and friends abroad.
North American passenger numbers have grown nearly 230% year-over-year, with New York’s JFK Airport reclaiming its first place as Heathrow’s most popular route.
And after a very difficult pandemic, the UK’s largest airport warns it faces a ‘long road to recovery’ – highlighting the cost of Covid-19 testing and the effective ban on UK passengers traveling to United States.
Since early August, fully vaccinated travelers from the US and EU have been allowed to travel to England without having to self-isolate. And Heathrow is urging the United States to follow suit and lift its restrictions on fully vaccinated travelers from the UK.
With fully vaccinated US visitors now able to travel to the UK without the need for quarantine, the joint UK / US Travel Working Group must capitalize on the rollout of leading vaccines in the UK and reach a reciprocal agreement for fully vaccinated UK travelers.
The airport is also pushing the government to cut the cost of Covid-19 testing – claiming other European countries have lowered their prices or are subsidizing them.
Heathrow argues that cheaper lateral flow tests should be used for low-risk destinations – to prevent travel from becoming the preserve of the wealthy.
Heathrow CEO, Emma Gilthorpe, says:
“Finally, a blue sky looms on the horizon, as the travel and trade routes slowly reopen. The work is far from over, however. The government must now capitalize on the vaccine dividends and seize the opportunity to replace expensive PCR tests with more affordable side-flow tests.
This will ensure that travel remains achievable for the hard-working Brits desperate for well-deserved getaways and keen to reunite with loved ones before the summer travel window closes. “
The UK’s competition watchdog is also looking into the issue of Covid-19 testing fees, following concerns about the vastly different prices they are charged.
My colleague Sarah butler explained on Sunday that:
Similar tests for days 2 and 8 after return to England listed on the government website can cost over £ 300 or as little as £ 20. On average, prices in the UK are £ 75, compared to around £ 40 in France and Greece.
Last Friday, Health Secretary Sajid Javid wrote to the Competition and Markets Authority asking them to help eliminate “exploitative behavior” and “unfair practices” among the more than 400 companies offering the tests and he said the government was determined to take action.
Also coming today
The future of the UK inhaler company Vectura is at stake, after private equity bidder Carlyle withdrew from a bidding war with tobacco company Philip Morris International.
PMI now has until 5 p.m. on Thursday to improve its (already higher) bid, while Vectura’s board must now decide which bid to support.
In a statement to the city this morning, Vectura’s board said it would “make a new announcement” once that deadline expires, or sooner if PMI declares its offer final.
Markets are also bracing for the latest US inflation data, which will show whether prices continued to rise last month. The US CPI is expected to fall to 5.3% year-on-year, after a 13-year high of 5.4% in June.
- 9am BST: China Money Supply and Lending Data for July
- 9:30 a.m. BST: UK Manufacturers’ Sales by Product: 2020, published by the Office for National Statistics
- Noon BST: Weekly mortgage approvals in the United States.
- 1:30 p.m. BST: US inflation data for July