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Cancelled flights could become the new normal in Europe as airlines strive to protect margins amid surging jet fuel prices. With wages accounting for 25% of revenue (vs. the global average of 19%), European airlines have little incentive to address staff shortages in the short term.
The ECB is facing a “risk trilemma” as its hawkish monetary policy pivot raises the specter of fragmentation risk, which threatens to impede the efficient transmission of monetary policy.