Airline shares are always bad investments; sometimes they make a nice trade. Is now the time for that trade? On Wednesday, as Hong Kong listed Chinese H shares staged a limp rebound, China Eastern and China Southern rose 6 per cent; Air China by half as much.

Even after the bounce, China’s airline stocks look bombed out. This is unsurprising. With most of their debt denominated in US dollars, the airlines have taken a big hit from the falling renminbi. In the third quarter of 2015, Air China lost more than $500m in profit to a yuan which fell 2.5 per cent, leaving it with net profits of just over $350m. Although both China Southern and China Eastern hedge, purportedly, each recorded similar losses.

The bleeding will get worse. During the fourth quarter, the yuan fell 3.5 per cent. It is expected to fall further yet. Worse, the weakness may be a symptom of an economy in dire straits, which has unsettling implications for demand. Recent data, such as figures from the Australian Bureau of Statistics showing record high Chinese arrivals for 2015, will not allay these fears. Much of that travel will have been booked before China’s currency volatility began. The continuing fight against corruption, now spreading into the private sector, could put a further squeeze on high-end demand.