History of Inflation in UK

Historical UK Inflation

Inflation since 1810

inflation

Inflation has reduced the value of money. Rising prices means money buys less than it used to. See: Definition of Inflation

Inflation since 1860

historical-inflation-1860

Periods of  Inflation in UK

1920s/30s deflation

1914-38-inflationUK

After inflation of the First World War, the UK experienced deflation (falling prices) during the 1920s and early part of 1930s. This deflation was due to tight monetary and fiscal policy and an overvalued exchange rate (Gold Standard).

See more detail at: Economics of the 1920s

Inflation in 1960s and 1970s

inflation

In the post-war period, the UK economy experienced strong growth with moderate inflation.

However, in the 1970s, we see inflation rising to double figures and reaching over 25%.

This inflation was due to rising oil prices (oil prices tripled in the 1970s). There was also inflation due to rising wages. Unions were relatively powerful and were bargaining for higher wages to keep up with the rising cost of living – causing a wage-inflationary spiral.

See also: economics of the 1970s

Inflation since 1989

inflation

Towards the end of the 1980s, the UK experienced rapid economic growth. This growth of 4-5% a year was significantly higher than the UK’s long run trend rate of economic growth. This excessive economic growth led to demand-pull inflation of 8%. See: Lawson boom.

Inflation 1949-2015

annual-inflation uk

Periods of Inflation In UK

Deflation of the 1920s and 1930s.

The UK hasn’t always had inflation. In the 1920s and 30s, there was a long period of deflation (falling prices). This meant the value of money increased. The 1920s and 30s, were generally a period of low growth and high unemployment.

Inflation of the 1970s

inflation-1970s

The highest peace time inflation occurred in the 1970s, when inflation rose due to wage push and oil push inflation. See: Economy of the 1970s

Cost push inflation of 2008-2013

cpi-inflation

The UK experienced periods of cost-push inflation during 2008-2013. This inflation was caused by rising oil prices, devaluation of Pound and higher taxes. See: Cost push inflation

Historical Inflation and Interest rates

Inflation and Interest Rates since 1900

Interest rates and Inflation since 2003

inflation-interest-rates

Related

Inflation in UK (year end)

  • 2014 – 2.2
  • 2013 – 3.4
  • 2012 – 3.6
  • 2011 – 4.8%
  • 2010 – 3.5%
2009-0.50%
20084.00%
20074.30%
20063.20%
20052.80%
20043.00%
20032.90%
20021.70%
20011.80%
20003.00%
19991.50%
19983.40%
19973.10%
19962.40%
19953.50%
19942.40%
19931.60%
19923.70%
19915.90%
19909.50%
19897.80%
19884.90%
19874.20%
19863.40%
19856.10%
19845.00%
19834.60%
19828.60%
198111.90%
198018.00%
197913.40%
19788.30%
197715.80%
197616.50%
197524.20%
197416.00%
19739.20%
19727.10%
19719.40%
19706.40%
19695.40%
19684.70%
19672.50%
19663.90%
19654.80%
19643.30%
19632.00%
19624.30%
19613.40%
19601.00%
19590.60%
19583.00%
19573.70%
19564.90%
19554.50%
19541.80%
19533.10%
19529.20%
19519.10%
19503.10%
19492.80%
19487.70%
19477.00%
19463.10%
19452.80%
19442.70%
19433.40%
19427.10%
194110.80%
194016.80%
19392.80%
19381.60%
19373.40%
19360.70%
19350.70%
19340.00%
1933-2.10%
1932-2.60%
1931-4.30%
1930-2.80%
1929-0.90%
1928-0.30%
1927-2.40%
1926-0.80%
19250.30%
1924-0.70%
1923-6.00%
1922-14.00%
1921-8.60%
192015.40%
191910.10%
191822.00%
191725.20%
191618.10%
191512.50%
1914-0.30%
1913-0.40%
19123.00%
19110.10%
19100.90%
19090.50%
19080.50%
19071.20%
19060.00%
19050.40%
1904-0.20%
19030.40%
19020.00%
19010.50%
19005.10%
18990.70%
18980.30%
18971.50%
1896-0.30%
1895-1.00%
1894-2.00%
1893-0.70%
18920.40%
18910.70%
18900.20%
18891.40%
18880.70%
1887-0.50%
1886-1.60%
1885-3.00%
1884-2.70%
1883-0.50%
18821.00%
1881-1.10%
18803.00%
1879-4.40%
1878-2.20%
1877-0.70%
1876-0.30%
1875-1.90%
1874-3.30%
18733.10%
18724.70%
18711.40%
18700.00%
1869-5.00%
1868-1.70%
18676.10%
18666.50%
18650.90%
1864-0.90%
1863-3.60%
1862-2.60%
18612.70%
18603.70%
1859-1.80%
1858-8.40%
1857-5.60%
18560.00%
18553.30%
185415.10%
18539.30%
18520.00%
1851-3.00%
1850-6.40%
1849-6.30%
1848-12.10%
184712.00%
18464.00%
18454.90%
1844-0.10%
1843-11.30%
1842-7.60%
1841-2.30%
18401.80%
18397.30%
18380.70%
18372.50%
183611.00%
18351.70%
1834-7.80%
1833-6.10%
1832-7.40%
18319.90%
1830-3.60%
1829-1.00%
1828-2.90%
1827-6.50%
1826-5.50%
182517.40%
18248.60%
18236.80%
1822-13.50%
1821-12.00%
1820-9.30%
1819-2.50%
18180.30%
181713.50%
1816-8.40%
1815-10.70%
1814-12.70%
18132.50%
181213.20%
1811-2.90%
18103.20%
18099.70%
18083.40%
1807-1.90%
1806-4.40%
180516.20%
18043.20%
1803-5.90%
1802-23.00%
180111.70%
180036.50%
179912.30%
1798-2.20%
1797-10.00%
17966.40%
179511.60%
17947.70%
17932.80%
17921.50%
1791-0.10%
17901.80%
1789-1.30%
17884.00%
1787-0.60%
17860.00%
1785-4.00%
17840.60%
178312.00%
17822.10%
17814.10%
1780-3.40%
1779-8.50%
17784.00%
1777-0.40%
1776-2.20%
1775-5.60%
17740.90%
1773-0.30%
177210.70%
17718.50%
1770-0.40%
1769-8.20%
1768-1.10%
17675.80%
17661.20%
17653.50%
17648.90%
17632.70%
17623.90%
1761-4.50%
1760-4.50%
1759-7.90%
1758-0.30%
175721.80%
17564.20%
1755-6.00%
17545.10%
1753-2.70%
17524.70%
1751-2.70%
17500.00%

Source: Historical UK Inflation

2 thoughts on “History of Inflation in UK

  1. Thank you for this useful data. Just a typo to report. The interest rates and inflation since 1979 chart has Series 1 and Series 2 instead of interest rates and inflation.

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