The COVID pandemic, which became globally widespread in early 2020, was nearly totally unprecedented and had a massive effect on the economy in both Australia and the world.

Varying flow-on effects from lockdowns, illness, and societal disruptions have led to significant impact on inflation and the cost of living, but are there any particular storylines that we can tease out based on the data?

The Australian Bureau of Statistics, the national government agency dedicated to measuring and analysing society, has published quarterly price indices on a variety of facets of the Australian economy, including the overall cost of imports and exports.

By looking at how the import price has fluctuated, and comparing selected subcategories to the overall trend, we might be able to see if this has influenced some of the domestic pricing as well.

There were already some increases from the “baseline” around 2011/2012, but around the time of COVID and the periods after, the figures all increased rapidly - “materials” had the largest level of price gain, but it was already quite high beforehand.

It’s worth noting that fuel had been peaking around the time of the benchmarking in 2011/12, as (unlike the other statistics) it remains under 100 for most of the subsequent period. Also consider that a sudden spike also took place during the global financial crisis of 2008/2009, but that it was recovered from more quickly than the post-COVID fluctuations have been.

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From the plot on the previous slide, we found that while there has been a generally close relationship between the cost of importing food and the cost of purchasing it, the relationship has become less connected during the aftermath of the COVID pandemic, with import costs reaching an all-time high in late 2022 and purchase costs following close behind. The relationship becoming less direct, and the two trends diverging, may have been influenced by government intervention to attempt to reduce the cost of living burden.