IATA reported that international passenger traffic increased 7.3% year-over-year in July while domestic traffic rose 3.5%. Total system traffic heightened 5.9%. Airfreight traffic declined 0.4% as world trade sputtered, IATA said.

"Passenger travel bucked the gloomy economic outlook with a 5.9% increase in July," IATA DG and CEO Tony Tyler said. "This increase was likely based on the much more optimistic economic outlook that marked the beginning of the year. With business and consumer confidence now tanking, sluggishness in international trade and high fuel prices, the expectation is for a weaker end to the year. We are already seeing this in the shrinking airfreight markets, which were 0.4% down on the previous year."

The fastest international RPK growth in July occurred in Latin America, up 10.3% compared to July 2010, IATA said. Middle East followed with a 9.7% increase in international traffic. Europe grew 9.3%, Africa 6.6%, Asia/Pacific 4.9% and North America 3.9%. IATA said European carriers are benefiting from a "strong expansion of inward demand that is taking advantage of the weakened currency," while the "disappointing economic outlook continues to dampen demand in North America."