The inflation rate in the United States declined significantly between June 2022 and January 2025, despite rising inflationary pressures towards the end of 2024. The peak inflation rate was recorded in June 2022, at 9.1 percent. In August 2023, the Federal Reserve's interest rate hit its highest level during the observed period, at 5.33 percent, and remained unchanged until September 2024, when the Federal Reserve implemented its first rate cut since September 2021. By January 2025, the rate dropped to 4.33 percent, signalling a shift in monetary policy. What is the Federal Reserve interest rate? The Federal Reserve interest rate, or the federal funds rate, is the rate at which banks and credit unions lend to and borrow from each other. It is one of the Federal Reserve's key tools for maintaining strong employment rates, stable prices, and reasonable interest rates. The rate is determined by the Federal Reserve and adjusted eight times a year, though it can be changed through emergency meetings during times of crisis. The Fed doesn't directly control the interest rate but sets a target rate. It then uses open market operations to influence rates toward this target. Ways of measuring inflation Inflation is typically measured using several methods, with the most common being the Consumer Price Index (CPI). The CPI tracks the price of a fixed basket of goods and services over time, providing a measure of the price changes consumers face. At the end of 2023, the CPI in the United States was 158.11 percent, up from 153.12 a year earlier. A more business-focused measure is the producer price index (PPI), which represents the costs of firms.

In January 2025, global inflation rates and central bank interest rates showed significant variation across major economies. Most economies initiated interest rate cuts from mid-2024 due to declining inflationary pressures. The U.S., UK, and EU central banks followed a consistent pattern of regular rate reductions throughout late 2024. In early 2025, Russia maintained the highest interest rate at 21 percent, while Japan retained the lowest at 0.5 percent. Varied inflation rates across major economies The inflation landscape varies considerably among major economies. China had the lowest inflation rate at 0.5 percent in January 2025. In contrast, Russia maintained a high inflation rate of 9.9 percent. These figures align with broader trends observed in early 2025, where China had the lowest inflation rate among major developed and emerging economies, while Russia's rate remained the highest. Central bank responses and economic indicators Central banks globally implemented aggressive rate hikes throughout 2022-23 to combat inflation. The European Central Bank exemplified this trend, raising rates from 0 percent in January 2022 to 4.5 percent by September 2023. A coordinated shift among major central banks began in mid-2024, with the ECB, Bank of England, and Federal Reserve initiating rate cuts, with forecasts suggesting further cuts through 2025 and 2026.

In January 2025, the UK inflation rate was three percent, with prices rising fastest in the education sector, which had an inflation rate of 7.5 percent. In this month, prices were rising in all sectors, with the inflation rate for services as a whole at five percent, while for goods, prices grew by one percent. UK inflation falls in 2024 After reaching a peak of 11.1 percent in October 2022, the CPI inflation rate in the UK gradually declined over several months, falling to a low of 1.7 percent by August 2024. An uptick in inflation has occurred since that month, however, and by the end of the year inflation was at 2.5 percent above the Bank of England's target rate of two percent. Going into 2025, recent forecasts suggest that over the course of the year, inflation will average out at 2.6 percent, with the two percent target not met on an annual basis until at least 2029. Roots of the inflation crisis This long period of high inflation that the UK and much of the world experienced had its roots in the post-pandemic economic recovery of 2021. During that year, as consumer demand returned, global supply chains struggled to return to full capacity, resulting in prices rising. With inflation already elevated going into 2022, Russia's invasion of Ukraine added even more inflationary pressures to the global economy. European markets which were heavily reliant on Russian oil and gas gradually phased out hydrocarbons from their economies. Food prices were also heavily impacted due to Ukraine's difficulty in exporting its agricultural products.

Between January 2018 and February 2025, the United Kingdom's consumer price inflation rate showed notable volatility. The rate hit its lowest point at 0.5 percent in August 2020 and peaked at 9.6 percent in October 2022. By September 2024, inflation had moderated to 2.6 percent, but the following months saw inflation increase again. The Bank of England's interest rate policy closely tracked these inflationary trends. Rates remained low at 0.5-0.75 percent until April 2020, when they were reduced to 0.1 percent in response to economic challenges. A series of rate increases followed, reaching a peak of 5.25 percent from August 2023 to July 2024. The central bank then initiated rate cuts in August and November 2024, lowering the rate to 4.75 percent, signaling a potential shift in monetary policy. In February 2025, the Bank of England implemented another rate cut, setting the bank rate at 4.5 percent. Global context of inflation and interest rates The UK's experience reflects a broader international trend of rising inflation and subsequent central bank responses. From January 2022 to July 2024, advanced and emerging economies alike increased their policy rates to counter inflationary pressures. However, a shift began in late 2024, with many countries, including the UK, starting to lower rates. This change suggests a potential new phase in the global economic cycle and monetary policy approach. Comparison with other major economies The UK's monetary policy decisions align closely with those of other major economies. The United States, for instance, saw its federal funds rate peak at 5.33 percent in August 2023, mirroring the UK's rate trajectory. Similarly, central bank rates in the EU all increased drastically between 2022 and 2024. These synchronized movements reflect the global nature of inflationary pressures and the coordinated efforts of central banks to maintain economic stability. As with the UK, both the U.S. and EU began considering rate cuts in late 2024, signaling a potential shift in the global economic landscape.

Inflation Rate in Brazil increased to 5.06 percent in February from 4.56 percent in January of 2025. This dataset provides - Brazil Inflation Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

Explore the impact of inflation in Japan on living costs, with households and businesses facing increasing financial pressures amid rising prices for essentials.

In a survey targeting e-commerce merchants in France, around 83 percent reported increasing their prices in response to inflationary pressures in 2023. Another 53 percent of online retailers said they had to reduce their profit margins, and just under half of surveyed respondents reported cancelling or postponing certain investments.

Gross domestic product (GDP) of Malaysia grew 3.56 percent in 2023 and was forecast to remain around 4 percent for the medium term. What affects GDP? GDP is the sum of spending in a country by consumers, investors, and the government, plus net exports. High GDP growth is associated with low unemployment, because a growing economy demands a growing labor force. There are also inflationary pressures, but responsible monetary and fiscal policy can keep the inflation rate low. GDP and development Developmental economists focus more on GDP per capita than GDP. Looking at how much each member of the economy generates gives a general idea of the level of development, with strong correlations between this and other development indicators. If population growth is faster than GDP growth, residents in the country will be worse off, in spite of a growing economy.

Inflation Rate in Nicaragua increased to 3.45 percent in February from 2.73 percent in January of 2025. This dataset provides the latest reported value for - Nicaragua Inflation Rate - plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news.

August 2024 marked a significant shift in the UK's monetary policy, as it saw the first reduction in the official bank base interest rate since August 2023. This change came after a period of consistent rate hikes that began in late 2021. In a bid to minimize the economic effects of the COVID-19 pandemic, the Bank of England cut the official bank base rate in March 2020 to a record low of 0.1 percent. This historic low came just one week after the Bank of England cut rates from 0.75 percent to 0.25 percent in a bid to prevent mass job cuts in the United Kingdom. It remained at 0.1 percent until December 2021 and was increased to one percent in May 2022 and to 2.25 percent in October 2022. After that, the bank rate increased almost on a monthly basis, reaching 5.25 percent in August 2023. It wasn't until August 2024 that the first rate decrease since the previous year occurred, signaling a potential shift in monetary policy. Why do central banks adjust interest rates? Central banks, including the Bank of England, adjust interest rates to manage economic stability and control inflation. Their strategies involve a delicate balance between two main approaches. When central banks raise interest rates, their goal is to cool down an overheated economy. Higher rates curb excessive spending and borrowing, which helps to prevent runaway inflation. This approach is typically used when the economy is growing too quickly or when inflation is rising above desired levels. Conversely, when central banks lower interest rates, they aim to encourage borrowing and investment. This strategy is employed to stimulate economic growth during periods of slowdown or recession. Lower rates make it cheaper for businesses and individuals to borrow money, which can lead to increased spending and investment. This dual approach allows central banks to maintain a balance between promoting growth and controlling inflation, ensuring long-term economic stability. Additionally, adjusting interest rates can influence currency values, impacting international trade and investment flows, further underscoring their critical role in a nation's economic health. Recent interest rate trends Between 2021 and 2024, most advanced and emerging economies experienced a period of regular interest rate hikes. This trend was driven by several factors, including persistent supply chain disruptions, high energy prices, and robust demand pressures. These elements combined to create significant inflationary trends, prompting central banks to raise rates in an effort to temper spending and borrowing. However, in 2024, a shift began to occur in global monetary policy. The European Central Bank (ECB) was among the first major central banks to reverse this trend by cutting interest rates. This move signaled a change in approach aimed at addressing growing economic slowdowns and supporting growth.

The sporting goods manufacturing industry has benefitted from rising health consciousness over the past decade, which spurred an uptick in sports participation, driving demand. However, inflationary pressures plagued the industry in the aftermath of the COVID-19 outbreak, resulting in people cutting discretionary spending. Revenue is expected to sink at a compound annual rate of 5% over the five years through 2024 to €9.3 billion, including an estimated dip of 2.4% in 2024. Following the COVID-19 outbreak, pent-up demand and supply chain disruptions incited inflationary pressures, ratcheting up living costs. This resulted in many people’s real household disposable income’s plummeting, forcing them to cut discretionary spending on goods like sporting equipment. Despite central banks across Europe raising interest rates to curb rising prices, inflation persisted in the two years through 2023, hurting demand. However, rising sport participation and health consciousness have supported revenue in recent years, with Denmark achieving the top spot as the sportiest country in the EU, according to the Sporting Good Intelligence Group. Revenue is forecast to swell at a compound annual rate of 3.7% over the five years through 2029 to €11.2 billion, while the average industry profit margin is anticipated to reach 9%. Sporting goods manufacturing will welcome declining costs as inflationary pressures subside in the short term, as tightening monetary policy takes hold. Sport participation will also continue to rise, supported by robust funding towards promoting exercise as governments seek to slow down rising obesity across Europe. Major events like the 2024 Paris Olympic and Paralympic Games will drive sport participation in the years following, supporting revenue growth.

Material recovery service providers have contended with numerous economic headwinds in recent years, ranging from subdued economic growth in the aftermath of the COVID-19 outbreak and the rising base rate environment as central banks aim to curb spiralling inflation. Revenue is expected to sink at a compound annual rate of 3.5% over the five years through 2024 to €106.8 billion, including an estimated dip of 3.3% in 2024. Demand for material recovery services is highly contingent on downstream construction, mining and manufacturing sectors that produce hefty amounts of waste. Since the COVID-19 outbreak, rising interest rates have ramped up the cost of borrowing while building material costs skyrocketed, putting off many developers from beginning projects and weighing on construction activity. Subdued economic growth has also hit the manufacturing sector, eroding demand for material recovery services. However, growing recycling rates are set to maintain demand, supported by government initiatives like the European Green Deal, which includes the Circular Economy Action Plan. Revenue is expected to climb at a compound annual rate of 2.7% over the five years through 2029 to €122.2 billion. Economic conditions are set to improve in the short term as inflationary pressures subside, allowing central banks to adopt looser monetary policy and support GDP growth. This will drive activity in downstream construction and manufacturing sectors in the short term, lifting demand for material recovery services. The growing emphasis on sustainability will also persist in the coming years as countries across Europe strive for a circular economy, driving demand and supporting revenue growth.

In January 2025, prices had increased by three percent compared to January 2024 according to the 12-month percentage change in the consumer price index — the monthly inflation rate for goods and services in the United States. The data represents U.S. city averages. In economics, the inflation rate is a measure of the change in price level over time. The rate of decrease in the purchasing power of money is approximately equal. A projection of the annual U.S. inflation rate can be accessed here and the actual annual inflation rate since 1990 can be accessed here. InflationOne of the most important economic indicators is the development of the Consumer Price Index in a country. The change in this price level of goods and services is defined as the rate of inflation. The inflationary situation in the United States had been relatively severe in 2022 due to global events relating to COVID-19, supply chain restrains, and the Russian invasion of Ukraine. More information on U.S. inflation may be found on our dedicated topic page. The annual inflation rate in the United States has increased from 3.2 percent in 2011 to 8.3 percent in 2022. This means that the purchasing power of the U.S. dollar has weakened in recent years. The purchasing power is the extent to which a person has available funds to make purchases. According to the data published by the International Monetary Fund, the U.S. Consumer Price Index (CPI) was about 258.84 in 2020 and is forecasted to grow up to 325.6 by 2027, compared to the base period from 1982 to 1984. The monthly percentage change in the Consumer Price Index (CPI) for urban consumers in the United States was 0.1 percent in March 2023 compared to the previous month. In 2022, countries all around the world are experienced high levels of inflation. Although Brazil already had an inflation rate of 8.3 percent in 2021, compared to the previous year, while the inflation rate in China stood at 0.85 percent.

The sporting goods manufacturing industry has benefitted from rising health consciousness over the past decade, which spurred an uptick in sports participation, driving demand. However, inflationary pressures plagued the industry in the aftermath of the COVID-19 outbreak, resulting in people cutting discretionary spending. Revenue is expected to sink at a compound annual rate of 5% over the five years through 2024 to €9.3 billion, including an estimated dip of 2.4% in 2024. Following the COVID-19 outbreak, pent-up demand and supply chain disruptions incited inflationary pressures, ratcheting up living costs. This resulted in many people’s real household disposable income’s plummeting, forcing them to cut discretionary spending on goods like sporting equipment. Despite central banks across Europe raising interest rates to curb rising prices, inflation persisted in the two years through 2023, hurting demand. However, rising sport participation and health consciousness have supported revenue in recent years, with Denmark achieving the top spot as the sportiest country in the EU, according to the Sporting Good Intelligence Group. Revenue is forecast to swell at a compound annual rate of 3.7% over the five years through 2029 to €11.2 billion, while the average industry profit margin is anticipated to reach 9%. Sporting goods manufacturing will welcome declining costs as inflationary pressures subside in the short term, as tightening monetary policy takes hold. Sport participation will also continue to rise, supported by robust funding towards promoting exercise as governments seek to slow down rising obesity across Europe. Major events like the 2024 Paris Olympic and Paralympic Games will drive sport participation in the years following, supporting revenue growth.

The Information and Communication Equipment retailing industry has benefitted from the digitisation of economies across Europe, with businesses expanding on their online offerings to capitalise on the growing e-commerce market. Despite this, numerous economic headwinds still plague growth, ranging from a tightening cost of living to rising purchase costs from upstream suppliers. Revenue is anticipated to fall at a compound annual rate of 5.8% over the five years through 2024 to €113.1 billion, including an estimated decline of 4.6% in 2024, while the average industry profit margin is forecast to be 6.5%. The COVID-19 outbreak triggered a mass adoption of technology across Europe, with consumers under lockdown restrictions turning to smartphones, tablets and computers to quench their boredom. The tech boom was short-lived, as economic growth slowed substantially in 2022 amid inflationary pressures and the rising base rate environment. This caused consumers to tighten their purse strings and resulted in a decline in businesses' investment towards IT capabilities as the cost of borrowing picked up and growth prospects vanished. Inflationary pressures persisted in 2023, denting consumer expenditure. However, this also presented opportunities for retailers to offer cheaper second-hand technology. Premium-priced products, like iPhones, were also less exposed to the tightening cost of living squeeze, supporting revenue growth. Revenue is forecast to grow at a compound annual rate of 1.5% over the five years through 2029 to €121.9 billion, while the average industry profit margin is estimated to reach 3.6%. Improving economic conditions will lift revenue growth in the coming years, facilitating a resurgence in business and consumer confidence, which will drive demand for information and communication equipment. Retailers that cater to the growing market of environmentally conscious consumers will lead the industry in the coming years, purchasing products from manufacturers with eco-friendly production processes that seek to limit energy consumption and improve waste treatments.

Cement, lime and plaster manufacturers have contended with numerous economic headwinds in recent years, including the COVID-19 outbreak, supply chain disruptions and aggressive interest rate hikes from central banks across Europe. These have clobbered construction activity, which is key in determining demand for cement, lime and plaster. To make matters worse, cement, lime and plaster manufacturers were forced to halt operations under COVID-19 lockdown rules, driving a dramatic decline in production output. The measures put in place to curb the virus also hit construction markets, with many projects being delayed or cancelled, further denting demand. Cement, lime and plaster manufacturing revenue is estimated to fall at a compound annual rate of 2.8% over the five years through 2024 to €40.6 billion. Revenue is set to plummet by 3.3% in 2024, although the average industry margin is expected to edge upwards to 5.3% as supply chain disruptions subside, alleviating cost pressures. Since COVID-19 hit, inflationary pressures have picked away at cement, lime and plaster manufacturers’ profitability. Rising prices were brought about by surges in demand amid the gradual reopening of the economy coinciding with disruptions to supply chains. In 2022, inflation worsened, triggered by Russia’s invasion of Ukraine towards the start of the year, which compounded supply chain disruptions. Although proving less volatile than other building materials in 2022, cement prices picked up in 2023 despite falling energy costs – this is because cement is slower to react to market conditions than other building materials. The inflationary environment also resulted in central banks ramping up interest rates, raising the cost of borrowing and weighing on construction activity. Cement, lime and plaster manufacturing revenue is forecast to grow at a compound annual rate of 3.1% over the five years through 2029 to €47.2 billion. Construction activity is set to pick up in 2025 as inflationary pressures subside, letting central banks lower interest rates, which will give investor sentiment a boost. Manufacturers will also be able to capitalise on growing demand for sustainability, allowing them to exploit value-added opportunities; although the R&D they’ll need to put into green products and processes will dent profitability in the short term, these will drive revenue growth over the long term.

Security service companies have experienced substantial upheaval, with providers facing significant revenue volatility. The onset of COVID-19 forced a wave of business closures and a mass shift to remote work. This led to a sharp decline in demand for security services, as physical premises were left unattended and corporate profit stagnated, prompting businesses to cut back on expenses. As a result, the industry witnessed a pronounced drop in revenue throughout 2020. In 2021, although pandemic restrictions eased and economic activity picked up, the reluctance of a substantial portion of the workforce to return to offices continued to constrain demand. It wasn't until 2022 that a notable recovery took place when more employees returned to workplaces, fueling an uptick in demand for security personnel. Despite the rebound in 2022, the industry has faced further challenges due to broader economic conditions. In particular, inflationary pressures prompted the Federal Reserve to hike interest rates, bringing recessionary fears to the fore. This stifled demand for security services in 2023 and 2024 as companies hesitated over investments amid economic uncertainty. Meanwhile, the industry has seen consolidation through mergers and acquisitions, as major players like Allied Universal and Securitas AB expanded their foothold by acquiring competing firms. Rising labor costs and fierce competition have also exerted pressure on profit, driving some companies to seek niche markets or diversify their service offerings. Overall, revenue for security service providers in the United States has dwindled at a CAGR of 1.2% over the past five years, reaching $46.0 billion in 2025. This includes a 1.0% rise in revenue in that year. Looking ahead, security companies are expected to gradually regain strength over the next five years, assuming macroeconomic stability prevails. As the Federal Reserve starts easing interest rates in response to cooling inflation and a moderating job market, the environment for investment will improve, potentially boosting demand for security services. Urbanization trends and increasing business formation are expected to prop up revenue, along with a rise in corporate profit leading to greater spending on security measures. However, potential changes in economic policy, such as tariffs, could pose challenges, while declining crime rates may reduce the necessity for traditional security services. Overall, revenue for security service companies in the United States is forecast to creep upward at a CAGR of 1.0% over the next five years, reaching $48.4 billion in 2030.

Automotive Automatic Tire Inflation System (ATIS) Market Outlook

The global automotive automatic tire inflation system (ATIS) market size was estimated to be USD 1.2 billion in 2023 and is expected to reach USD 2.6 billion by 2032, growing at a compound annual growth rate (CAGR) of 8.9% during the forecast period. The growth of this market is driven by increasing emphasis on vehicle safety, fuel efficiency, and the rising adoption of advanced automotive technologies.

The rising demand for fuel-efficient vehicles is a significant growth factor in the ATIS market. Automatic tire inflation systems help maintain optimal tire pressure, which in turn reduces rolling resistance, leading to improved fuel efficiency. Governments across the globe are implementing stringent regulations related to vehicle emissions and fuel efficiency, urging automobile manufacturers to integrate more advanced systems such as ATIS. Furthermore, the increasing consumer awareness regarding the benefits of maintaining correct tire pressure is also propelling market growth.

Another crucial driver for the ATIS market is the significant advancements in automotive technologies. As vehicles become more sophisticated, integrating systems that can optimize vehicle performance and safety becomes increasingly important. ATIS offers enhanced safety by reducing the risk of tire blowouts and ensuring even tire wear, which can prevent accidents caused by tire failures. Technological advancements, such as the development of more reliable sensors and control units, are making these systems more effective and affordable, further boosting their adoption.

In addition to technological advancements, the growing commercial vehicle segment is bolstering the ATIS market. Commercial vehicles, such as trucks and buses, benefit immensely from ATIS as they frequently cover long distances and carry heavy loads. Maintaining optimal tire pressure in these vehicles is critical for operational efficiency and safety. Fleet operators are increasingly recognizing the cost benefits associated with reduced tire wear and improved fuel efficiency, leading to higher adoption rates of ATIS in the commercial vehicle sector.

Regionally, Asia Pacific is expected to witness significant growth in the ATIS market during the forecast period. The rising automotive production in countries like China and India, combined with the increasing adoption of advanced automotive technologies, is driving market growth in this region. Additionally, increasing urbanization and rising disposable incomes are leading to higher vehicle ownership rates, further boosting the demand for ATIS. North America and Europe are also key markets due to the presence of major automotive manufacturers and stringent regulations regarding vehicle safety and fuel efficiency.

Type Analysis

The automotive ATIS market is segmented into two primary types: Central Tire Inflation System (CTIS) and Continuous Tire Inflation System (CTIS). The Central Tire Inflation System is designed to adjust the tire pressure based on the terrain and load conditions. This system is particularly beneficial for off-highway vehicles and commercial trucks that often travel on varying terrains. The ability to adapt tire pressure to the driving conditions not only enhances vehicle performance but also improves safety and reduces tire wear, making it a preferred choice in heavy-duty applications.

On the other hand, the Continuous Tire Inflation System maintains a constant optimal tire pressure regardless of the driving conditions. This system is highly beneficial for passenger vehicles and light commercial vehicles where consistent tire pressure is crucial for fuel efficiency and safety. The continuous monitoring and adjustment of tire pressure ensure that the vehicle operates at peak efficiency, leading to lower fuel consumption and reduced emissions. The simplicity and reliability of continuous systems make them attractive for a wide range of vehicles.

The choice between central and continuous systems largely depends on the specific application and vehicle type. While central systems offer more flexibility and adaptability, continuous systems provide consistency and ease of use. Both types are witnessing increasing adoption, driven by their respective advantages and the growing emphasis on tire maintenance as a critical aspect of vehicle performance and safety.

With ongoing advancements in sensor technology and the integration of IoT in automotive systems, both central and continuous tire inflation systems are expected t

Cement, lime and plaster manufacturers have contended with numerous economic headwinds in recent years, including the COVID-19 outbreak, supply chain disruptions and aggressive interest rate hikes from central banks across Europe. These have clobbered construction activity, which is key in determining demand for cement, lime and plaster. To make matters worse, cement, lime and plaster manufacturers were forced to halt operations under COVID-19 lockdown rules, driving a dramatic decline in production output. The measures put in place to curb the virus also hit construction markets, with many projects being delayed or cancelled, further denting demand. Cement, lime and plaster manufacturing revenue is estimated to fall at a compound annual rate of 2.8% over the five years through 2024 to €40.6 billion. Revenue is set to plummet by 3.3% in 2024, although the average industry margin is expected to edge upwards to 5.3% as supply chain disruptions subside, alleviating cost pressures. Since COVID-19 hit, inflationary pressures have picked away at cement, lime and plaster manufacturers’ profitability. Rising prices were brought about by surges in demand amid the gradual reopening of the economy coinciding with disruptions to supply chains. In 2022, inflation worsened, triggered by Russia’s invasion of Ukraine towards the start of the year, which compounded supply chain disruptions. Although proving less volatile than other building materials in 2022, cement prices picked up in 2023 despite falling energy costs – this is because cement is slower to react to market conditions than other building materials. The inflationary environment also resulted in central banks ramping up interest rates, raising the cost of borrowing and weighing on construction activity. Cement, lime and plaster manufacturing revenue is forecast to grow at a compound annual rate of 3.1% over the five years through 2029 to €47.2 billion. Construction activity is set to pick up in 2025 as inflationary pressures subside, letting central banks lower interest rates, which will give investor sentiment a boost. Manufacturers will also be able to capitalise on growing demand for sustainability, allowing them to exploit value-added opportunities; although the R&D they’ll need to put into green products and processes will dent profitability in the short term, these will drive revenue growth over the long term.

The economy of the United Kingdom shrank by 0.1 percent in January 2025, after growing by 0.4 percent in December. As of the most recent month, the UK economy is around 3.4 percent larger than it was in February 2020, just before the start of COVID-19 lockdowns. After a record 19.6 percent decline in GDP in April 2020, the UK economy quickly returned to growth in the following months, and grew through most of 2021. Cost of living crisis lingers into 2025 As of December 2024, just over half of people in the UK reported that their cost of living was higher than it was in the previous month. Although this is a decline from the peak of the crisis in 2022 when over 90 percent of people reported a higher cost of living, households are evidently still under severe pressure. While wage growth has outpaced inflation since July 2023, overall consumer prices were 20 percent higher in late 2024 than they were in late 2021. For food and energy, which lower income households spend more on, late 2024 prices were almost 30 percent higher when compared with late 2021. According to recent estimates, living standards, as measured by changes in disposable income fell by 2.1 percent in 2022/23, but did start to grow again in 2023/24. Late 2023 recession followed by growth in 2024 In December 2023, the UK economy was approximately the same size as it was a year earlier, and struggled to achieve modest growth throughout that year. Going into 2023, a surge in energy costs, as well as high interest rates, created an unfavorable environment for UK consumers and businesses. The inflationary pressures that drove these problems did start to subside, however, with inflation falling to 3.9 percent in November 2023, down from a peak of 11.1 percent in October 2022. Although relatively strong economic growth occurred in the first half of 2024, with GDP growing by 0.7 percent, and 0.4 percent in the first two quarters of the year, zero growth was reported in the third quarter of the year. Long-term issues, such as low business investment, weak productivity growth, and regional inequality, will likely continue to hamper the economy going forward.