Brazil's inflation rate demonstrated significant volatility between January 2018 and December 2024. Initially fluctuating between 1.88 and 4.94 percent, the rate dramatically peaked at 12.13 percent in April 2020. After a gradual decline to 3.16 percent in June 2023, it rose to 4.61 percent in August 2023. Throughout 2024, inflation decreased monthly until April, reaching 3.69 percent, before entering another inflationary phase. Simultaneously, the Central Bank of Brazil adjusted the Selic rate in response to these economic dynamics. Following a series of rate hikes from February 2021 to August 2022, the Selic reached 13.75 percent. This rate remained stable until July 2023, when a series of cuts began. By April 2024, the Selic had dropped to 10.75 percent, further reduced to 10.5 percent in May 2024. As inflation increased in the latter part of 2024, the central bank initiated rate hikes, setting the Selic at 12.25 percent in December 2024.

In case prices for goods and services go up significantly in 2023, over 20 percent of consumers around the world said they would shop less in general and cut down on spending as a response. A fifth of survey respondents said they would look for and purchase cheaper and better value products. Less than five percent of those surveyed worldwide believed inflation would be unlikely to impact their habits. What does inflation look like? The world entered a new inflation crisis in 2021, driven by a confluence of factors including the COVID-19 pandemic which restricted global supply chains, and the Russian-Ukraine war which exacerbated food and energy shortages. In 2022, global inflation hit 8.71 percent, the highest annual increase in decades. The rate of inflation is estimated to remain high in the near future, at around 6.9 percent in 2023 and 5.8 percent in 2024. Inflation dominated the list of most important problems facing the world according to a survey conducted in October 2023 – leading ahead of poverty and social inequality, crime and violence, and unemployment. In a global consumer trends survey, the majority of respondents said that inflation impacted them completely or a lot – for instance, seven in 10 respondents in the United States admitted they had been seriously impacted. Inflation’s impact on the holidays The end-of-year holiday season is typically regarded as a period of increased retail spending, driven by a series of major shopping events such as Black Friday and Cyber Monday, as well as the public holidays Thanksgiving and Christmas. However, inflation has put a damper on the holiday cheer, with consumers expressing their intentions to cut back spending amid the cost-of-living crisis. In 2022, a significant share of consumers in Europe said they planned to cut at least some related expenses. In fact, 40 percent of respondents in the United Kingdom planned to cut all expenses related to Black Friday and Christmas.

In the third quarter of 2024, half of Norwegian companies had problems with increasing purchase prices as a result of rising inflation seen around the world. Moreover, more than 40 percent faced problems due to an unstable economic framework. On the other hand, only 10 percent had issues with lack of credits or financing. As a consequence of the COVID-19 pandemic, as well as the Russian War in Ukraine that started in February 2022, inflation has been surging worldwide. For more information about inflation in the Nordic countries, please visit our dedicated topic page.

Inflation is generally defined as the continued increase in the average prices of goods and services in a given region. Following the extremely high global inflation experienced in the 1980s and 1990s, global inflation has been relatively stable since the turn of the millennium, usually hovering between three and five percent per year. There was a sharp increase in 2008 due to the global financial crisis now known as the Great Recession, but inflation was fairly stable throughout the 2010s, before the current inflation crisis began in 2021. Recent years Despite the economic impact of the coronavirus pandemic, the global inflation rate fell to 3.26 percent in the pandemic's first year, before rising to 4.66 percent in 2021. This increase came as the impact of supply chain delays began to take more of an effect on consumer prices, before the Russia-Ukraine war exacerbated this further. A series of compounding issues such as rising energy and food prices, fiscal instability in the wake of the pandemic, and consumer insecurity have created a new global recession, and global inflation in 2024 is estimated to have reached 5.76 percent. This is the highest annual increase in inflation since 1996. Venezuela Venezuela is the country with the highest individual inflation rate in the world, forecast at around 200 percent in 2022. While this is figure is over 100 times larger than the global average in most years, it actually marks a decrease in Venezuela's inflation rate, which had peaked at over 65,000 percent in 2018. Between 2016 and 2021, Venezuela experienced hyperinflation due to the government's excessive spending and printing of money in an attempt to curve its already-high inflation rate, and the wave of migrants that left the country resulted in one of the largest refugee crises in recent years. In addition to its economic problems, political instability and foreign sanctions pose further long-term problems for Venezuela. While hyperinflation may be coming to an end, it remains to be seen how much of an impact this will have on the economy, how living standards will change, and how many refugees may return in the coming years.

Low income Mexican households were the most affected by inflation. According to the source, the annual inflation rate of the representative consumer basket of households with low income experienced the largest increase in February 2024: 5.85 percent compared to the same month of the previous year. By contrast, the market basket of high income households (those that earn, on average, a monthly income of 66,899 Mexican pesos) registered an inflation rate of 4.77 percent.

Over two-thirds of American households with children entering K-12 in the fall of 2024 were expecting rising prices to impact them more this year compared to last year. In contrast, just two percent of respondents surveyed said they expected inflation to impact their back-to-school shopping less this time around.

As of April 2022, a large share of consumers in the United States believed inflation would have a greater impact on their financial situation in the next few months than it has to-date. Especially, struggling consumers (between 60 and 70 percent) felt this way. Close to 50 percent of those living in comfortable and prospering households expected the impact of rising prices to remain the same.

Inflation in Argentina was 54 percent in 2019, before falling to 42 percent in 2020. Despite Argentina's fluctuating economic instability over the twentieth century, the largest factor in its current economic status is the legacy of poor fiscal discipline left by the economic depression from 1998 to 2002. Although data is not available from 2014 to 2016, Argentina's inflation rate has been among the highest in the world for the past five years.

What causes inflation?

Inflation is a rise in price levels for all goods. Major causes of inflation include an increase in money supply, low central bank interest rates, and expectation of inflation. In a country such as Argentina, the expectation can be one of the biggest obstacles. People expect inflation to be high and demand increasing wages, and firms continue raising prices because they expect the costs of inputs to increase. Banks follow suit, charging high interest rates on fixed deposits.

Effects of inflation

Inflation negatively affects savers. 100 Argentinian pesos in 2018 was worth just under 75 pesos in 2019, after adjusting for the 34 percent inflation rate. Similarly, frequently changing prices has its own inherent cost, called “menu cost” after the price of printing new menus. Inflation will also have a positive effect on national debt when that debt is denominated in Argentinian pesos, because the pesos will be cheaper when the loan matures. However, the majority of Argentina’s debts are in foreign currency, which means that inflation will make these debts larger in peso terms.

A survey conducted by Rakuten Insight in March 2023 found that about 85 percent of respondents in Singapore reported that rising prices of groceries had the most significant impact on them. In addition, 54 percent of respondents stated that inflation in utility costs was the most challenging to deal with.

In 2023, Japan had an average inflation rate estimated at 3.21 percent, marking the highest rate of inflation in Japan in almost a decade. However, this figure was still very low compared to most other major economies, such as Japan's fellow G7 members, four of which had inflation rates around six or seven percent in 2023 due to the global inflation crisis. Why is Japan's inflation rate lower? There are a number of contributing factors to Japan's relatively low inflation rate, even during economic crises. Japan eased its Covid restrictions more slowly than most other major economies, this prevented post-pandemic consumer spending that may have driven inflation through supply chain issues caused by higher demand. As the majority of Japan's food and energy comes from overseas, and has done so for decades, the government has mechanisms in place to prevent energy and wheat prices from rising too quickly. Because of this, Japan was able to shield its private sector from many of the negative knock on effects from Russia's invasion of Ukraine, which had a significant impact on both sectors globally. Persistent deflation and national debt An additional factor that has eased the impact of inflation on Japan's economy is the fact that it experienced deflation before the pandemic. Deflation has been a persistent problem in Japan since the asset price bubble burst in 1992, and has been symptomatic of Japan's staggering national debt thereafter. For almost 30 years, a combination of quantitative easing, low interest rates (below 0.5 percent since 1995, and at -0.1% since 2016), and a lack of spending due to low wages and an aging population have combined to give Japan the highest national debt in the world in absolute terms, and second-highest debt in relation to its GDP, after Venezuela. Despite this soaring debt, Japan remains the fourth-largest economy in the world, behind the U.S., China, and Germany.

The UK inflation rate was three percent in January 2025, up from 2.5 percent in the previous month, and the fastest rate of inflation since March 2024. Between September 2022 and March 2023, the UK experienced seven months of double-digit inflation, which peaked at 11.1 percent in October 2022. Due to this long period of high inflation, UK consumer prices have increased by over 20 percent in the last three years. As of the most recent month, prices were rising fastest in the communications sector, at 6.1 percent, but were falling in both the furniture and transport sectors, at -0.3 percent and -0.6 percent respectively.
The Cost of Living Crisis High inflation is one of the main factors behind the ongoing Cost of Living Crisis in the UK, which, despite subsiding somewhat in 2024, is still impacting households going into 2025. In December 2024, for example, 56 percent of UK households reported their cost of living was increasing compared with the previous month, up from 45 percent in July, but far lower than at the height of the crisis in 2022. After global energy prices spiraled that year, the UK's energy price cap increased substantially. The cap, which limits what suppliers can charge consumers, reached 3,549 British pounds per year in October 2022, compared with 1,277 pounds a year earlier. Along with soaring food costs, high-energy bills have hit UK households hard, especially lower income ones that spend more of their earnings on housing costs. As a result of these factors, UK households experienced their biggest fall in living standards in decades in 2022/23. Global inflation crisis causes rapid surge in prices The UK's high inflation, and cost of living crisis in 2022 had its origins in the COVID-19 pandemic. Following the initial waves of the virus, global supply chains struggled to meet the renewed demand for goods and services. Food and energy prices, which were already high, increased further in 2022. Russia's invasion of Ukraine in February 2022 brought an end to the era of cheap gas flowing to European markets from Russia. The war also disrupted global food markets, as both Russia and Ukraine are major exporters of cereal crops. As a result of these factors, inflation surged across Europe and in other parts of the world, but typically declined in 2023, and approached more usual levels by 2024.

In a survey conducted in the United States in May 2022, the vast majority of respondents (93 percent) said that inflation affected their decision to buy and sell pre-owned goods. The main reason driving recommerce demand was the concern to save money and hunt for bargains.

In the United States, almost one in five online shoppers profited from Amazon Prime Day deals to stock up on items that got more expensive because of inflation in 2022. According to a poll, over one-third of the surveyed U.S. consumers even waited for Amazon Prime in order to purchase a product at a lower price. Overall, the inflation rate had no effect on a limited share of consumers – less than 20 percent.

The inflation rate for both Africa, the Middle East, and Latin America and the Caribbean reached more than 12 percent in 2023. Among the provided continents or regions, Asia and the Pacific had the lowest inflation rate that year. Consumer prices increased around the world following the COVID-19 pandemic and the Russian invasion of Ukraine. Inflation and food security Increases in food costs are one of the most prominent impacts of inflation globally. In the United Kingdom, for example, consumers have indicated that they have worried more about food costs in 2023 than in previous years. Meanwhile, in Canada, only a small fraction of survey respondents have said that inflation has had little impact on household food costs. Consumers have responded to rising food costs through various coping mechanisms. For example, Italian consumers have indicated that they purchase less unnecessary products, cut down on waste, and buy more discounted items in order to save costs. Changing consumer behvaiors Outside of food consumption, consumers have changed their purchasing behaviors with other types of goods and services. Surveying has indicated that nearly 60 percent of consumers have adjusted their shopping habits due to inflation. When holiday shopping in 2023, over 50 percent of Americans and over one third of British consumers said inflation had considerable impact on their holiday shopping. By generation, the Millenial generation has suffered the most due to rising inflation, while older generations have experienced less serious impacts.

Inflation is perceived as a critical problem by the vast majority of Italians, as only nine percent of the population believes that this phenomenon did not impact their lives. Therefore, citizens were forced to change their everyday consumption customs. In 2023, 60 percent of the interviewees reduced their shopping expenses due to the increase in prices and half of the respondents decided to cut the electricity consumption. Cultural and leisure activities were directly affected by inflation too, as 50 percent of the individuals opted for diminishing spendings in this sector. On the contrary, only 35 percent decided to contract grocery shopping. Hence, Italians reacted to the growing inflation by curtailing optional expenses and maximizing the necessary ones.

In a survey conducted by Rakuten Insight in March 2023 in Singapore, about 90 percent of respondents aged 55 years and above reported that rising prices of groceries had the most significant impact on them. In addition, 68 percent of respondents in the same age group stated that inflation in utility costs was the most challenging to deal with.

A survey conducted by Rakuten Insight in March 2023 found that 62 percent of respondents in Singapore checked prices before purchasing goods or services because of inflation. Moreover, 58 percent of respondents indicated that they had to cut back on unnecessary spending.

In a survey conducted by Rakuten Insight in March 2023 in India, 34 percent of respondents in India stated that they need be cautious of their expenses due to inflation. In comparison, 26 percent of respondents reported that they were not impacted by inflation.

Iran’s inflation rate rose sharply to 34.79 percent in 2019 and was projected to rise another 14 percentage points before slowly starting to decline. Given the recent sanctions by the United States regarding the nuclear deal, this number has both political and economic implications. Political implications President Hassan Rouhani won the 2017 election based on economic promises, many stemming from the Joint Comprehensive Plan of Action (JCPOA), commonly known as the Iran Nuclear Deal. Lifting these sanctions opened the Iranian economy to many opportunities, including the chance to benefit from increased oil exports. The JCPOA was an integral part of the Rouhani campaign, so any economic hardship that is linked to the deal will likely be blamed on the president. Economic implications High inflation leads to high interest rates, which leads to less borrowing. Less borrowing means less investment, which slows economic growth. This slower growth often leads to higher inflation, which is what economists call an inflationary spiral. As such, Iran will have difficulty achieving substantial GDP growth until inflation returns to manageable rates.

In a survey conducted by Rakuten Insight in March 2023, about 86 percent of female and 83 percent of male respondents in Singapore reported that increasing price of groceries had the most significant impact on them. In comparison, 44 percent of female respondents were impacted by increased cost of personal care and health goods and services.