Can infrastructure investments provide protection from rising inflation?

With inflation in New Zealand on the rise, investors are considering how to protect their portfolios from any potential negative impacts.

Investing in a portfolio of global listed infrastructure assets may provide part of the solution. The First Sentier Investors Global Listed Infrastructure (PIE) Fund provides investors with exposure to assets including toll roads, airports, railroads, utilities, pipelines and mobile towers. These sectors share common characteristics like high barriers to entry and pricing power. The large majority of the assets we invest in have the ability to pass through inflation to the end customer.

Inflation and pricing power

Inflation is connected to interest rates, as monetary policy seeks to control rising prices through the mechanism of rate rises.