In this article, we will take a look at 25 countries with the highest inflation in the world. If you want to skip our detailed analysis of global inflation trends, you can directly go to 5 Countries With the Highest Inflation in the World.
Global Inflation in 2024
Inflation is generally defined as the overall increase in the prices of goods and services over time. According to the IMF, global inflation was 6.8% in 2023, with advanced economies having an inflation rate of 4.6% and developing economies having a rate of 8.3%. The regions that experienced the most inflation included Central Asia and the Caucasus, where prices increased by 38.8%. On the other hand, the lowest inflation rate was experienced by East Asia, at only 1%. In its April 2024 report on the World Economic Outlook, the IMF stated that global inflation is decreasing slowly but steadily.
According to the report’s predictions, global inflation will decrease to 5.9% in 2024 and 4.5% in 2025. Inflation in advanced economies is expected to decline to 2.6%, whereas in developing economies and emerging markets, it is expected to stay the same. Moreover, the predicted decrease in core inflation is 1.2% for 2024, compared to only 0.2% for 2023. Core inflation refers to the price increase in all sectors, excluding food and energy. As these industries prove to be highly volatile, including them in the measurement of core inflation can reflect a skewed picture.
The IMF also expects inflation to decrease faster for advanced economies than for emerging markets. According to the report, advanced economies will revert to their pre-pandemic inflation rate (2%) by 2025, a year before emerging markets and developing economies manage to do so. However, even within emerging economies, there is a lot of divergence in inflation rates. The inflation forecast for emerging Asia is around 2.4%, mainly due to decreasing inflation rates in China and Thailand. The estimate for emerging Europe is around 18.8% due to a high rate of inflation recorded in Türkiye.
READ ALSO: 36 Countries with Deflation or Dangerously Low Inflation and 20 Countries With Lowest Inflation Rates In The World.
All Eyes on Rate Cuts
As of April 2024, the IMF states that the US has an inflation rate of 2.9%, a decrease from 4.1% in 2023 and 8% in 2022. From 2020 to 2022, inflation in the US had risen from 1.2% to 8%. For an in-depth look, you can check out US states with the highest inflation rates. This massive increase in prices led the Federal Reserve to increase interest rates. In March 2022, the interest rate was between 0.25% to 0.5%; by July 2023, it had risen to 5.25% to 5.5%, which is steady even in August 2024. This is the highest that interest rates have been in 22 years.
Interest rates and inflation do not have a straightforward relationship. However, higher interest rates are generally used as a policy response to tackling inflation as they lead to dampened demand and increased supply. Once inflation targets are achieved, interest rates can be lowered to allow the economy to progress. In the United States, the Federal Reserve has an annual inflation target of 2%. Although the current rate stands higher than this (2.9%), it has fallen below 3% for the first time since 2021. This has led the Chairman of the Fed, Jerome Powell, to declare that the US is now preparing to cut interest rates. The Fed’s next meeting on rate-cutting will occur in September 2024, and many believe that interest rates will be cut for the first time since the COVID-19 pandemic.
Contrary to the US, the United Kingdom hasn’t presented an optimistic image as of yet. Inflation in the UK increased from 0.9% in 2020 to 9.1% in 2022. In 2023, it dropped to 7.3%, and as of July 2024, it stands at 2.2%. As for interest rates, they were at 0.1% in December 2021, increasing to 5.25% by August 2023. In August 2024, the UK’s central bank decided to drop interest rates to 5%. However, inflation is still above the Bank’s target of 2%, with warnings that it will increase even further in the coming months, reaching 2.75%. Andrew Bailey, the governor of the Bank of England, has stated that this looming danger of inflation might require the interest rates to remain high for a while.
Impact on the Private Sector
Inflation negatively impacts consumers as well as businesses. Although overall inflation has decreased in the United States, the disadvantageous effects of high prices are still visible in several segments. For the sake of this piece, we will take an in-depth look at the food industry. Food inflation is tracked separately for two main categories: food-at-home (grocery purchases) and food-away-from-home (restaurant purchases). Historically speaking, food prices have increased dramatically over the past two years.
According to data from the US Department of Agriculture (USDA), in 2022, there was an increase of 11.4% in food-at-home prices and an increase of 7.7% in food-away-from-home prices. This was highly worrying as most consumers consider grocery shopping to be cheaper than eating out. In 2023, there was an increase of 5% in food-at-home prices and 7.1% in food-away-from-home prices. In 2024, the USDA expects food-at-home prices to increase by 1.2% and food-away-from-home prices to grow by 4.1%.
Revenue Management Solutions, a consulting firm, conducted a survey in February 2024 that polled low-income consumers, i.e., individuals who make less than $50,000 annually. 25% of respondents said they had decreased their fast food consumption, whereas 50% said they had lessened visits to fast-casual and full-service restaurants. Fast food companies are generally considered more affordable for low-income consumers, but the current prices have made that difficult.
A 2024 study by Finance Buzz evaluated the menu prices of several fast food chains over a ten-year period, discovering that McDonald’s Corporation (NYSE:MCD) was one of the companies with the most significant price hikes. From 2014 to 2024, the price of a McDouble sandwich increased by 168%, medium fries increased by 138%, and a ten-piece McNugget meal increased by 83%. Calculating price increases across nine menu items revealed an average price hike of 100% from 2014 to 2024. In May 2024, the president of McDonald’s Corporation (NYSE:MCD) USA, Joe Erlinger, revealed that there had been an average increase of 40% in McDonald’s prices from 2019 to 2024.
To keep providing affordable options for low-income consumers, McDonald’s Corporation (NYSE:MCD) announced that starting June 25, it would begin offering a $5 value meal including a McDouble cheeseburger or a McChicken sandwich, four-piece Chicken McNuggets, small french fries, and a small soft drink. Despite initial plans to keep the meal on the menu for a month, the company later announced that the meal would continue to be offered at 93% of US locations for the entirety of August. This happened for two reasons: consumers rushing to the chain’s outlets for the pocket-friendly option and competitors like Burger King and Wendy’s unleashing similar value meals.
Introducing cost-effective options and limited-time offers is one of the main reasons chains like McDonald’s Corporation (NYSE:MCD) manage to keep their low-income consumers engaged. In the company’s Q2 earnings call, Erlinger revealed that the trial in participation rate for the $5 meal was 70% higher than their January buy one get one meal. This rate refers to the number of customers who try a product during a specific window in time. The company’s CEO, Chris Kempczinski, also mentioned that the average bill of customers buying the $5 meal came up to $10, showcasing that the meal encourages consumers to buy more. Erlinger further revealed that in Q2 of 2024, the company had its highest-ever year-to-date score for customer satisfaction.
It’s pertinent to note that in Q2, McDonald’s Corporation (NYSE:MCD) generated a revenue of $6.49 billion, which missed estimates by $137.21 million. In the earnings call, Kempczinski mentioned that the pressure of lack of sales from low-income consumers has only increased as the year progressed. He elaborated that overall industry traffic has slowed in major markets like the US and Canada, as quick-service restaurants continue to lose sales. The war in the Middle East also impacted the company’s overall sales, among other internal factors. However, the company’s executives also shared some positive aspects.
Mainly, they commended the $5 deal for driving sales, especially among low-income consumers. They also mentioned that the company’s other promotions on products, such as the Bacon Cajun Ranch McCrisp, also drove sales while positively impacting brand relevance as well. They also discussed a Canada-specific promotional code on fried items, available through the restaurant’s mobile app. Throughout its availability, 3.5 million codes were entered as part of the promotion. Seeing the positive impact of these deals, the company has several other promotions lined up for the coming months, which may attract even more low-income customers.
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Now that we have taken a broad look at global inflation and its impact on businesses, let’s delve into 25 countries with the highest inflation in the world.
25 Countries With the Highest Inflation in the World
25 Countries With the Highest Inflation in the World
Our Methodology
To compile this list of 25 countries with the highest inflation in the world, we consulted Insider Monkey’s database that has inflation rates of over 200 countries and territories as of 2023. We selected the 25 countries with the highest inflation in the world and sorted them in ascending order of their inflation rates. To get a complete picture of our methodology, you can take a look at Inflation Rates by Country: 2023 Data.
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25 Countries With the Highest Inflation in the World
25. Democratic Republic of the Congo
Inflation Rate (2023): 19.9%
The Democratic Republic of the Congo ranks 25th on our list of countries with the highest inflation rates, with a 2023 inflation rate of 19.9%. This was a sharp increase from 2021 and 2022, when average inflation remained around 9%.
24. Sri Lanka
Inflation Rate (2023): 20.4%
According to the Central Bank of Sri Lanka, Sri Lanka’s overall inflation was 20.4% in 2023. However, the rates were drastically different from January (51.7%) to December (4%), showcasing volatility. As of July 2024, the country’s inflation rate has fallen to 2.4%.
23. São Tomé and Príncipe
Inflation Rate (2023): 21.2%
According to IMF’s data from April 2024, the inflation rate of São Tomé and Príncipe has decreased to 14.2%. It is expected to be a further half by 2025, decreasing to 7.8%. São Tomé and Príncipe ranks 23rd on our list of countries with the highest inflation.
22. Egypt
Inflation Rate (2023): 24.4%
From 2021 to 2024, Egypt saw its inflation rate increase from 4.5% to 24.4%. Unfortunately, the inflation hasn’t slowed down, and as of April 2024, it stands at 32.5%. In 2023, food prices saw a year-on-year increase of 71%. The high inflation stems from several factors, including the Russia-Ukraine war and high prices of crude oil.
21. Nigeria
Inflation Rate (2023): 24.7%
Inflation in Nigeria has been increasing consistently since 2019. In March 2024, it rose to 33.2%, a 28-year high. Rising prices are due to several government policies, such as devaluing the local currency and removing petrol subsidies. Nigeria ranks 21st on our list.
20. Burundi
Inflation Rate (2023): 27%
After a tough year with inflation, prices in Burundi are slightly decreasing. In April 2024, inflation was measured at 22% by the IMF. Burundi is 20th on our list of countries with the highest inflation rates in the world.
19. Myanmar
Inflation Rate (2023): 27.1%
Inflation in Myanmar was 3.6% in 2021 but rose rapidly over the next two years due to depreciation of the local currency and rising prices in the international market. So far in 2024, inflation has decreased to 15% due to some level of economic stabilization. However, the public at large is still struggling with rising prices.
18. Pakistan
Inflation Rate (2023): 29.2%
From 2022 to 2023, the inflation rate in Pakistan grew 141%. The high inflation in the country is alarming and is the cost of depreciating currency, along with reforms demanded by the IMF as a condition for its loans. These include removal of subsidies and easing of import restrictions.
17. Cuba
Inflation Rate (2023): 30%
Cuba’s economic conditions have remained distressed for several years now, mainly due to government policies. According to a Reuters report from January 2024, citizens are preparing for inflation to rise even higher as the government announces tax increases and subsidy cuts. Cuba ranks 17th on our list, with an inflation rate of 30%. It is one of the countries with the highest inflation globally.
16. Ethiopia
Inflation Rate (2023): 30.2%
Rising inflation is one of the biggest worries for Ethiopian citizens, with the economy worsening even further due to the local conflict. Food prices have especially been affected in these circumstances, making life difficult for the poorest households. However, the IMF does expect inflation to drop in the next few years.
15. Malawi
Inflation Rate (2023): 30.3%
Malawi’s inflation rate increased drastically in 2022 and 2023 but is slowly stabilizing. Inflation dropped to 27.9% in 2024 and is expected to decrease further to 14% by 2025. Currently, Malawi ranks 15th on our list of countries with the highest inflation in the world.
14. Laos
Inflation Rate (2023): 31.2%
Inflation in Laos saw a massive increase from 2021 to 2022 when it rose from 3.8% to 23%. This happened for a vast number of reasons, including a shortage of fuel and foreign currency. The increase in global energy prices also worsened the situation.
13. Ghana
Inflation Rate (2023): 37.5%
Inflation in Ghana also saw a drastic rise in 2022, with the prices for food, utilities, and fuel rising 47.9%, 79.1%, and 63.1% respectively. Even measures such as interest rate hikes and government spending cuts were unable to curb inflation, after which the country approached the IMF for help. Currently, in 2024, the inflation is around 22%.
12. South Sudan
Inflation Rate (2023): 40.2%
Continuous political instability and long-term conflicts have severely handicapped the South Sudanese economy. Inflation has hit intense highs several times over the past few years, rising to 346% in 2016. Since then, price hikes slowed down but saw a sharp increase again in 2023. The IMF has measured inflation in 2024 to be around 54% but projects a decrease for 2025.
11. Iran
Inflation Rate (2023): 41.5%
Iran has had high levels of inflation since 2018, ranking 11th on our list of countries with the highest inflation in 2023. The presence of multiple economic sanctions is one of the main reasons why the Iranian economy continues to face high price pressures.
10. Haiti
Inflation Rate (2023): 44.1%
Haiti ranks tenth on our list with an inflation rate of 44.1%. For the most part, the country relies on imports, as domestic production is not substantial enough for the local population. This is one of the reasons why the Ukraine-Russia war deeply impacted the Haitian economy, causing it to become one of the countries with the highest inflation rates in the world.
9. Sierra Leone
Inflation Rate (2023): 47.7%
Sierra Leona ranks 9th on our list of countries with the highest inflation rates in the world. In 2023, the country’s inflation stood at 47.7%, a drastic increase from 27.2% in 2022. Supply-side constraints were one of the biggest causes behind the inflation, and widespread food insecurity was one of its most significant consequences.
8. Suriname
Inflation Rate (2023): 51.6%
Inflation in Suriname stood at 51.6% in 2023, but by mid-2024, it had dropped to 20.7%. The country has managed to stabilize its exchange rate, and the IMF expects that inflation will continue to drop until the end of 2024, reaching 14%. However, as of yet, it’s one of the countries with the highest inflation in the world.
7. Türkiye
Inflation Rate (2023): 53.9%
Inflation has been one of Türkiye’s biggest issues since 2022, when it reached 72.3% from 19.6% in the previous year. In 2023, inflation fell to 53.9%, but in 2024 it has once again risen to 59%. There are several intertwined reasons behind the economic mess facing the country, including devaluing currency and large current account deficits.
6. Syria
Inflation Rate (2023): 112.27%
In 2023, Syria had an inflation rate of around 112%. Long-term conflict and military operations, combined with stringent government policies (e.g. price hikes) have deteriorated the Syrian economy. Furthermore, the scarcity of goods also adds fuel to the fire. Syria ranks sixth on the list of countries with the highest inflation globally.
5. Argentina
Inflation Rate (2023): 133.5%
Inflation in Argentina has been on the rise since 2020, reaching 249.8% in 2024. Historically, excessively high inflation rates have been a part of the Argentinian economy for several decades. Economists attribute this crisis to several reasons, including excessive government spending and money printing.
4. Sudan
Inflation Rate (2023): 171.5%
Inflation in Sudan has remained above 100% since 2020, making it one of the countries with the highest inflation around the globe. Some of the biggest reasons behind this high price hike is the excessive printing of money and food shortages.
3. Lebanon
Inflation Rate (2023): 221.3%
Lebanon ranks third on our list of countries with the highest inflation in the world. Inflation rate increased to more than 100% in 2021, and has stayed there since. One of the biggest reasons behind the rising inflation was the country’s high number of imports, including staples like wheat. Most of Lebanon’s wheat supply came from Russia and Ukraine, where the war led to massive supply disruptions.
2. Venezuela
Inflation Rate (2023): 337.5%
Venezuela’s hyperinflation crisis began in 2016 due to excessive money printing as a means of combatting fiscal issues. However, this caused inflation to rise drastically, reaching 65,000% in 2018. Additionally, the Venezuelan economy has been weakened by several years of budget deficits and decreasing oil prices, on which the country is heavily dependent.
1. Zimbabwe
Inflation Rate (2023): 667.4%
Zimbabwe ranks number one on our list of countries with the highest inflation in the world. The inflation rate did decrease to 561% in 2024; however, according to IMF predictions, it is still expected to stay above 400% until 2029. The country has been heavily sanctioned by the US, the European Union, and the IMF, which is considered to be one of the reasons behind its hyperinflation.
A weak exchange rate has also contributed to price hikes. In April 2024, the country launched a new gold-back currency known as ZiG, which it hopes will be able to fight decades of high inflation. Currently, around 85% of transactions in the country are conducted through the US dollar, which continues to be a trustworthy currency for most.
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Disclosure: None. This article is originally published on Insider Monkey.
