What's going on?

Data out on Monday showed that the cost of flying cargo around the world has reached record highs, as the world�s economies try to get their fragile economies where they need to be.

What does this mean?

Supply chains are always messy in the run-up to Christmas, but this year�s come with an added wrinkle: a shipping container shortage has been forcing companies to transport their products by air rather than sea. That�s problematic because passenger planes transport half of all air cargo, and many of them are� � for obvious reasons � still grounded. And while logistics companies like FedEx and DHL are trying to pick up the slack, it�s not enough: the amount of air cargo that can be transported is 13% lower than it was at the same time in 2019. So it stands to reason that costs are literally sky-high, with prices on key routes between China and the US and Europe having nearly doubled in the last three months (tweet this).

Why should I care?

The bigger picture: Danged if they do�
The world�s biggest central banks are set to meet this week to discuss how to tackle spiking inflation, and this data will only compound their worries. But Omicron�s put them in a Catch-22: anything they do to slow down rising prices also risks disrupting their countries� economic recoveries � not ideal at a time when lockdowns are back on the cards.

Zooming out: Turkey chances its arm.
Turkey�s arguably a good example of what not to do: the country�s prices were an eye-watering 21% higher in November than the same time last year, largely because its central bank has recently taken the left-field approach of cutting interest rates. That�s made it cheaper for companies and people to borrow money, encouraging them to spend and pushing prices even higher. Batten down the hatches: economists are expecting the country�s central bank to cut rates even lower this week.