By the end of 2025, global inflation measured by the annual Consumer Price Index (CPI) shows that price growth continues to moderate from the sharp increases seen during and after the COVID-19 pandemic, but remains elevated compared with levels before 2020.
CPI Trends in 2025
Data from the Organisation for Economic Co-operation and Development (OECD) reveal that year-on-year inflation across member countries has been trending lower throughout 2025. According to the latest OECD figures:
- In May 2025, headline inflation declined to 4.0 %, the lowest recorded since mid-2021, and down substantially from pandemic peak levels. Average price levels were still about 33.7 % higher than in December 2019, before the pandemic began.
- By August 2025, headline inflation remained around 4.1 %, indicating a stabilization of price increases across many advanced economies despite ongoing food and energy price pressures.
In addition to OECD economies, global CPI data compiled by the International Monetary Fund (IMF) show that world inflation stood at about 3.6 % in September 2025, with inflation in advanced economies around 2.7 %, and emerging markets generally higher on average.
Comparing with the Pandemic and Pre-Pandemic Years
To understand how 2025 compares with the recent past, it helps to look at global CPI trends over the past five years:
2019 (Pre-Pandemic):
Before COVID-19, annual global inflation in major economies typically hovered around or below 2 – 3 %, reflecting stable price conditions in many advanced economies.
2020:
As the pandemic struck, consumer prices were initially subdued in many countries due to lockdowns and reduced demand, with some inflation rates dropping below their historical averages.
2021–2022 (Pandemic Aftermath):
Supply-chain disruptions, strong fiscal and monetary stimulus, and energy price shocks contributed to a sharp rise in inflation. Many countries saw CPI rates jump above 6 – 8 % in this period, with global inflation peaking around 9.6 % in late 2022.
2023–2024 (Transition):
Inflation began to moderate as supply constraints eased and central banks tightened monetary policy. In 2024, OECD data show average annual inflation around 5.2 %, about 1.6 percentage points lower than in 2023 but still well above pre-pandemic norms.
2025:
The trend toward moderation continued in 2025. With OECD headline inflation around 4 – 4.1 % and global inflation near 3.6 %, price growth has declined markedly from the pandemic peak but remains above the pre-2020 range of about 2 – 3 %.
Key Drivers of Inflation Trends
Several factors influenced these global inflation dynamics:
- Pandemic-era disruptions: Lockdowns, supply chain bottlenecks and elevated demand in 2021–2022 pushed prices higher.
- Energy price volatility: Fluctuations in oil and gas prices contributed to spikes and subsequent easing of headline inflation.
- Central bank policies: Interest rate hikes across many countries helped cool price pressures over 2023–2025.
- Food price trends: In 2025 there have been signs of rising food inflation in some regions even as overall CPI moderates.
Where Inflation Stands at the End of 2025
By late 2025, global inflation is significantly lower than the high rates seen during the immediate post-pandemic period but still higher than typical pre-COVID levels. For many advanced economies, inflation rates have moved closer to long-term targets (around 2 – 3 %), while in broader global aggregates—including emerging markets—prices continue to rise at a moderate pace.
