UK National Inflation Analysis  

Recent UK Inflation by Year

UK inflation in the late 2000s was about 2.5 percent.

In 2009, directly after the Crash of 2008, UK experienced deflation, with prices down nearly 4 percent. But throughout the 2010s UK inflation remained steady at about 2 percent. The COVID experience boosted inflation to 7.25 percent. In 2026 UK inflation was 3.26 percent.

UK Inflation since 1945

From 1945 to 1960 UK inflation flucuated between 2 percent and 9 percent.

In the 1960s inflation began a huge fluctuating surge, ending up at a 25.7 percent price increase in 1975 with intermediate peaks at 6.07 percent in 1965 and 9.91 percent in 1970.

After retreating to 12.32 percent in 1978 inflation surged again peaking at 19.7 percent in 1980 before slowly decreasing in the 1980s, bottoming out at 4.62 percent in 1986.

Inflation staged another surge in the late 1980s, peaking at 8.12 percent in 1990. But then inflation subsided, fluctuating around 1 to 2 percent in the 1990s, 2.5 percent in the 2000s, and 1 to 2 percent in the 2010s. In the COVID recovery of 2021 inflation surged to over 7 percent.

UK Inflation and Deflation from 1860 to 1960

In the first decade of the 20th century under the gold standard UK prices were basically stable, after 4 percent inflation at the end of the Boer War.

In World War I inflation surged, peaking at 24.3 percent in 1917. After the war, with a policy of “resumption” back to the pre-war gold price, the UK experienced severe deflation, hitting 16.6 percent deflation in 1920. Prices were mildly deflationary -- peaking at a 2 percent decline in 1932 -- through the middle of the 1930s, when prices started to increase in 1935.

In World War II prices increased sharply, peaking at 11.42 percent increase in 1941, but thereafter declining to 1.64 percent in 1945. Post-war inflation surged to 9.08 percent inflation in 1947 before subsiding to 1.34 percent in 1950.

UK Inflation and Deflation in the Napoleonic Era

Great Britain experienced both significant inflation and deflation during and after the wars of the Napoleonic Era.

Inflation surged in the late 1790s as Europe went to war with Napoleonic France, reaching about 10 percent in 1795 and 1800. But there was severe deflation after the Treaty of Amiens in 1802.

Inflation returned as soon as conflict resumed between Britain and France in 1803. But the victory at Waterloo was followed by eight years of deflation hitting 5 percent a year as Britain returned to its pre-war gold price for sterling.

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