Australia's treasurer has warned that inflation in the country is expected to peak towards the end of the year and it will persist for a little bit longer because of the impact of the natural disasters and energy prices.

Jim Chalmers, who will on Tuesday night hand down his first federal budget, on Sunday said inflation is the primary influence on this budget, which guides the approach to cost of living relief, Xinhua news agency reported.

"On the current Treasury forecasts, inflation will persist for longer than we'd like," he told Australian Broadcasting Corporation television.

Treasury forecasts inflation will peak at 7.75 per cent in December.

"This will be a family-friendly budget which recognizes that our pressures on the economy come from around the world, but they're felt around the kitchen table," Chalmers said.

As a result of inflation, government spending on social security payments including the pension is expected to be about 33 billion Australian dollars (20.8 billion U.S. dollars) higher than previously forecast.

Earlier this week, the treasurer confirmed the ongoing flooding in Australia's southeast will harm the country's projected economic growth.

Thousands of homes and businesses have been affected by the floods, and the treasury forecasts the floods will drive the price of fruit and vegetables up by 8 per cent over the next six months.

Chalmers said the key elements of the strategy have two parts.

"First of all, how do we get wages moving again in this country, and the budget will be about that," he said on Sunday.

"But also how do we help inflation moderate over time. You do that by making sure your cost-of-living relief is responsible and that your investments in the economy don't push up inflation."

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