A Comprehensive Report on Brexit, Inflation, and UK Airlines

This report investigates the impact of Brexit on the airline industry, particularly focusing on the UK. It explores how Brexit has disrupted air services, affected agreements, and impacted airline revenue. The report also analyzes the rise in consumer price inflation in the UK from 2016 to 2018, examining the factors contributing to this increase, such as rising fuel prices. Furthermore, it discusses how these economic changes have affected airlines, considering the inclusion of airline fares in the consumer price index. The report concludes by outlining the Bank of England's strategies to reduce inflation to its target level, emphasizing the importance of maintaining a stable inflation rate for businesses and consumers. The report draws on various sources to support its analysis and conclusions.

Question and individual
reflective statement

Table of Contents
INTRODUCTION.......................................................................................................................................3
A. Impact of Brexit on airlines................................................................................................................3
B. Explain why consumer price inflation in the UK has risen from 2016 to 2018...................................3
How this may affect the airlines firms in the UK.....................................................................................3
How the Bank of England can reduce its inflation rate to its target level.................................................4
CONCLUSION...........................................................................................................................................4
REFERENCES............................................................................................................................................5

INTRODUCTION
Every business affected due to the uncertainty of the Brexit and it can provide the adverse
impact on each and every industry and aviation industry is one of them which also affected the
most. The main motive of this report is to discuss about the impact of Brexit on the airlines and
explain that why consumer price inflation in United Kingdom has risen.
MAIN BODY
A. Impact of Brexit on airlines
Due to the situation of Brexit, now industry wants to clarify from UK government & also EU
institutions on their transitionary agreement. Now industry continuously makes case for the
comprehensive EUUK airline agreement in longer terms. People now no longer enjoy the flight from UK
to EU and EU airlines now n longer enjoy the domestic UK traffic flight (Janse van Nieuwenhuizen,
2018). Due to Brexit, it affected the disruption of air services related agreement, air service agreement
mainly come into the question & now be renegotiated, improve border control & passengers management,
restricted movements of the goods, reduce the airlines revenue (Joakim Rutgersson, 2019).
B. Explain why consumer price inflation in the UK has risen from 2016 to 2018
The inflation rate for CIP (consumer price index) in UK fell to 0.4 % in February 2021.it is
analysed that CPI rate declined since 2018 and indicated the prices in UK been falling. Consumer price
index mainly involve the owners occupiers housing costs and consider the 12 months inflation rate that
was 2.3% in the month May 2018 and it up from the percentage of 2.2 in April 2018. As raising the fuel
prices that mainly produce the fuel in large upward contribution to change the rate between the April to
may 2018. It is analysed that upward Provide impact from air fears which mainly rose between April to
may but fell between same two months before a year and it influence the timing of the Easter (Consumer
price inflation, UK: May 2018).
How this may affect the airlines firms in the UK.
CPI has included the airlines fares as an effective component of public transport index. As per the
public transport index is mainly published in the all CPI areas(Oxford Analytica ). Airlines fare index
published monthly basis in US and other countries level & also eligible for the pricing that are
continuously schedule on the basis of international and domestic commercial airlines travel and trips on
the certified departing from all cities in the CPI.

Figure 1, Consumer price inflation, UK: April 2018
This Diagram demonstrates the consumer price inflation from 2016 to 2018.
How the Bank of England can reduce its inflation rate to its target level.
In order to keep the inflation at low level and stable, government mainly set the inflation rate
target of 2%. This can helpful in everyone plans for upcoming future purpose. On the basis of the
inflation, if it considered too high and also move a lot. It is difficult for the business to consider the right
price & those people who can plan their spending. Government considered various efforts to reduce the
inflation rate to its target level so that they can make plan for everyone for the future. Government set us
2 % inflation rate targets. But inflation is very negative and low then few people can put off spending it
because they expect that the price may be fall. Lower price may sound like effective and appropriate
things (Hendry and Muellbauer, 2018). If every people can reduce their specific spending then all the
organization could fall & people may lose their jobs. If by chance people miss inflation target by the more

than 1 % then it is essential to raise the question to the government. So the consumer prices index
inflation rate is specifically more than at least 3 % it less than 1 % then our governor can write the letter
to chancellor so that they can explain what will do to get the Targeted level that is 2% (Inflation and the
2% target, 2019).
CONCLUSION
According to this report it can be concluded that the impact of Brexit affect the
performance of the airline and also provide the more loss. Aviation industry affected a lot
because of the uncertainty of the Brexit. This report identified the impact of Brexit on the
working and business operations of the airlines which operates from UK to EU. This report also
analysed the CPI in the airlines industry. Lastly this report determined that how Bank of England
reduce the inflation rate.

REFERENCES
Books and Journals
Hendry, D. F., & Muellbauer, J. N. (2018). The future of macroeconomics: macro theory and
models at the Bank of England. Oxford Review of Economic Policy, 34(1-2), 287-328.
Janse van Nieuwenhuizen, I. J. (2018). Brexit and its impact on the United Kingdom's aviation
relations (Doctoral dissertation, University of Pretoria).
Oxford Analytica. Airlines are set to face uncertainty after UK Brexit. Emerald Expert Briefings,
(oxan-db).
Online
Rutgersson, J., How will Brexit impact the airline industry, 2019 , [ Online ] Available Through
< https://www.paxport.com/article/how-will-brexit-impact-airline-industry />
Consumer price inflation, UK: May 2018, [ Online ] Available Through,
https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/
may2018/
Inflation and the 2% target, 2019, [Online] Available Through,
https://www.bankofengland.co.uk/monetary-policy/inflation/