by Mat Churchill

Domestic air travel has become more affordable to Australians over the past few years, but overall prices have now hit their highest levels in more than 12 months.

Discount airfares have risen by more than five per cent during August as airlines try to regain some of their reduced margins.

Craig James, a CommSec economist said "With both consumers and businesses scouring for the best fares, the key question is whether the higher fares will stick?

"While discount fares are still lower than a year ago, business and full economy class fares are higher by almost six per cent, the strongest lift in prices for over a year.''

It is yet to be seen how this increase in prices will affect domestic arrivals to the Cairns Airport, with figures not due to be received from the airlines until the end of the month.

Communications Officer for Cairns Airport, Helen Laird, said that they have not noticed a decrease in domestic travellers to the airport.

"Our figures are showing an increase, but it would be a bit of a worry if we weren't seeing that at this time of year."

Figures for the end of July show arrivals increased to their highest level in five years with over 152,000 passengers making their way to Cairns Airport. That figure is up from around 147,000 in July 2009.