The Global Inflation Outlook

After the coronavirus pandemic and the Russian invasion of Ukraine caused accelerated inflation all over the world, what do those numbers look like in 2025? According to the International Monetary Fund, inflation is projected to remain elevated significantly above the recommended 2 percent in much of the world even this year. This is despite the fact that 30 countries are expected to have returned to target inflation between 2022 and the end of 2025, including many in Western Europe. Inflation meanwhile stayed elevated in parts of Africa, the Americas - including in the United States -, Asia and Oceania. While eastern Europe recovered slightly, Russia and its neighbors are seeing inflation pressures that are not subsiding as the war in Ukraine continues.

After the invasion of Ukraine by Russia in February 2022, the IMF measured inflation of 7.3 percent for developed countries and 9.5 percent for developing nations that year. In 2025, this is projected to have decreased to 2.5 percent and 5.5 percent, respectively. Due to eastern European inflation remaining high, emerging Europe is driving inflation here at 13.5 percent, followed by Sub-Saharan Africa at 13.3 percent as well as the Middle East and Central Asia at 11.1 percent. In many nations, the ongoing conflict in Ukraine is only a continuation of inflation pressures brought about by the Covid-19 pandemic, when disrupted global supply chains caused inflation to soar.

Because many developing nations are experiencing economic growth, inflation is generally higher on average in this group of countries. But this doesn't mean that inflation cannot hit non-industrialized countries hard if it happens at a time when their economies are struggling.

Countries experiencing conflict, upheaval or major economic problems are expected to see inflation rates far above the global average. Among them are Venezuela, Sudan, Zimbabwe, South Sudan and Iran, which will see the highest rates overall (of between 43 percent and 180 percent). Countries that have long struggled with inflation issues, like Turkey and Argentina, are also continuing to see inflation upwards of 35 percent per year. Nations where inflationary pressure increase significantly in the past three years include Nigeria, Egypt, Bolivia, Myanmar and Burundi.