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STORY: Airfares in Europe and Asia are starting to plateau or fall as a prolonged post-COVID travel boom is waning.

It's a setback for airlines struggling with higher costs and limited aircraft availability.

A global imbalance between supply of flights and pent-up demand as air travel opened up after the pandemic drove up ticket prices.

But industry experts and insiders said the "travel at all costs" trend is balancing out, with some customers becoming more sensitive to pricing as they grapple with inflation driving up living costs.

Fares were flat across the European bloc in the first months of this year compared with 2023, data from travel research group ForwardKeys shows.

The data is starker in Asia-Pacific where fares have dropped the most, down around 16% in the January to April period year-on-year.

With Asia slower to lift restrictions and ramp up overseas flights, travel to markets like Europe, America and Australia from countries like China has not recovered.

With China's economy sluggish, international flights remain around 70% of pre-pandemic levels.

Economists and analysts said flatter European airfares point to lower earnings and savings rates across the continent, leading consumers to seek cheaper options.

But a strong U.S. labor market has seen consumer spending hold up, with demand particularly strong for premium travel.

Around 16 million Americans traveled abroad in the first quarter of 2024, setting a new record and surpassing pre-pandemic volumes, according to the Mastercard Economics Institute.