Inflation consumer prices (annual %)

Inflation is one of the reasons why we can buy less and less every year with the same amount of money. Usually, the numbers resolve around several percentages, changing depending on the situation in the given country. However, in some cases the inflation is at such a high level, it exceeds dozens of percentages, which sadly has a gigantic influence on the economy.

Nevertheless, it is important to take into account the consumer price index. As you can guess, it is basically the way to determine the increases and decreases of services and goods depending on the inflation.

What did inflation look like in history?

No matter who you talk to, all the economists around the world agree that inflation is much lower in most of the countries than it was 20-30 years ago. It is all due to the introduction of globalization and the possibility to acquire almost any good effortlessly.

Depending on the exact year, inflation has been undergoing an unsteady reduction since the 1980’s. An important thing to note is that there were plenty of economic crises that drastically increased inflation around the world. Still, at this moment it is nowhere near the values it reached in 1981, which was around 12%. The lowest inflation one could notice was recorded in 2015 and it was 1.4%. Currently, it is around 2.4%.

What are the countries with the lowest inflation?

Before we move on and indicate the top 5 countries, it is important to understand that besides inflation, the countries can also experience deflation. It is simply a situation when the general prices for all the goods and services fall down. As a result, we can purchase more with the same amount of money. In most cases, it is caused by a smaller demand. However, in the case of increased productivity, deflation can also happen.

For this reason, we should firstly look at countries that exceed in production of goods that are most common in the world. One of the best examples is, obviously, oil and all the refineries that appeared in the United Arab Emirates and Saudi Arabia. As a result, the nations recorded a consumer prices index at the level of, respectively, -1.9% and -2.1%. The other two countries that experience deflation at this moment are Mali and Cote d'Ivoire with respectively -1.7% and -1%. Another nation that surprises us with a low index value is Qatar, which is around -0.7%.

What about the highest inflations?

If the inflation index exceeds standardized value by some large margins, then it means that we are dealing with extreme corruption at the highest level of government. As a result, all the prices in the nation are exorbitantly high and disproportionate to other expenditures and, what is incredibly important, to the salaries of citizens.

One of the best examples of such a situation is Venezuela. In the last several years the highest positions in the government and at the public bodies were occupied by corrupt politicians and businessmen. There, the inflation was at the approximate level of 255%, which is several times larger than in any other country without such significant issues.

South Sudan takes second place in our shameful ranking. The situation is evenly difficult as in the case of Venezuela. However, the last recorded inflation was much smaller, and it was around 185%.

The number three is taken by Sudan with the value of 51%. However, we should bear in mind that most of the countries have much smaller inflation. For example, countries with the biggest GDP have inflation as low as Japan (only 0.5%), at the average value like Germany and the United States (respectively 1.4% and 1.8%), or a bit higher level in the case of China and India (respectively 2.9 and 7.7%).