Australian and New Zealand Inflation Monitor: Inflation to Peak in June

Research evidence excerpt

Australian and New Zealand Inflation Monitor: Inflation to Peak in June

Goldman Sachs Australian and New Zealand Inflation Monitor

Exhibit 3: Inflation in international air transport prices in

New Zealand were soft in June

%mom %mom

75 75

International travel prices

Australia CPI: International holiday travel and accommodation prices

50 New Zealand CPI: International air transport prices 50

25 25

0 0

-25 -25

2023 2024 2025 2026

Source: ABS, StatsNZ, Goldman Sachs Global Investment Research

Food and non-alcoholic beverages

We expect food and non-alcoholic beverage inflation to remain firm (GSe: +0.6%mom).

Prices of fruit (GSe: +2.3%mom) and vegetables (GSe: +2.1%mom) are expected to

increase reflecting some seasonal effects as well as further pass through of recent input

cost increases, as we’ve discussed previously (Exhibit 4). We expect further pressure on

milk prices (GSe: +1.9%mom) as production and transport costs continue to flow to the

consumer.

Nitrogen fertiliser prices – including urea – have declined from their recent peak amid

seasonally soft global demand, and some reduction in supply disruptions (Exhibit 5).

Phosphate fertiliser prices have remained elevated, although as our commodities team

notes, phosphate can be drawn down from soil reserves in the short term, limiting the

immediate impact on yields. We also note that aside from some short-term fuel outages,

disruptions related to the Middle East conflict have largely seen higher costs, rather than

physical shortages (ABARES 2026). As a result, we continue to expect upwards pressure

on food prices over the near-term.

Exhibit 4: Prices for food and housing are likely to be Exhibit 5: Phosphate fertiliser prices remain elevated

boosted by higher input costs

bp bp US$/t US$/t

2.5 2.5 1250 1250