Goldman Sachs Asia in Focus: Import Price Inflation in Asia—Transitory This Time?
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Goldman Sachs analyzes the drivers of Asian import price inflation and its implications for consumer prices, concluding that the current inflationary impulse is likely transitory. The report notes that Asian import prices recently surged approximately 10% year-over-year, marking the steepest increase since mid-2022. However, this spike has been driven primarily by energy costs, contrasting sharply with the broad-based inflation seen in 2022.
Imported goods account for roughly one-tenth of Asian household consumption, a figure rising to one-quarter when including intermediate goods used to produce consumer items. The pass-through from import prices to CPI is historically brief across Asia, typically peaking around two months after an initial shock before fading significantly. Asia's inflation persistence parameter stands at just 0.2, well below the 0.4 seen in EMEA, reflecting effective policy offsets and competitive retail markets.
Furthermore, Chinese export prices are projected to rise only 1% in 2026, limiting upward regional pricing pressure. Under Goldman Sachs' baseline scenario, Asian import price inflation is expected to peak around 10% in the second quarter of 2026 before easing to a full-year increase of 4%. While Vietnam and Singapore have the highest consumption import content, the actual impact varies by policy buffers. An adverse scenario involving sustained Middle East energy disruptions and a stronger US dollar could trigger diverging regional inflation paths.