Inflationary issues

December 2025

Since we published our October Insights, the UK economy has stagnated with persistent inflation, high interest rates, weak business investment and global trade uncertainty. 

In November’s Autumn Budget, Chancellor Rachel Reeves unveiled measures aimed at stabilising public finances, tackling inflation and funding public services. These included freezing Income Tax and National Insurance thresholds and capping Cash ISA allowances. 

Here we summarise the key issues, along with the relevant insurance implications, that are likely to be affecting some customers.

Inflationary issues

October 2025

Since we published our July Insights, US tariffs continue to impact global trade and the average US tariff rate has surged to 15.8%, up from 2.3% at the end of 2024. 

Shifting global trade policies and geopolitical tensions have caused businesses to adjust their supply chains and delay capital investment decisions. However, despite external pressures the Office for National Statistics reports that over half of UK businesses are holding prices steady. 

Here we summarise the key issues, along with the relevant insurance implications, that are likely to be affecting some customers.

Inflationary issues

July 2025

Since we published our March Insights, Trump's 50% tariffs on steel and aluminium have sparked concern in the UK and Europe. The UK government is under pressure to finalise a trade deal with the US to protect its steel industry, which represents 7% of UK exports to the US. Economists warn of severe job losses, with previous tariffs costing the US 75,000 jobs. Efforts are underway to minimise the impact on trade and industry. (Source: BBC)

Following reciprocal strikes, Iran's parliament has approved a measure to potentially close the Strait of Hormuz, a vital global trade route through which more than a fifth of the world's daily oil supply passes. This move raises significant concerns for global trade. (Source: The Guardian)

Rising inflation, due to increasing labour costs and energy prices, is expected to remain above the Bank of England’s target of 2% for the rest of 2025.

In April, the minimum wage was raised for all groups. More than three million workers will now be better off; however, this could lead to cutbacks in hiring for some businesses. 

Here, we summarise the key issues, along with the relevant insurance implications, that are likely to be affecting some customers.

Inflationary issues

March 2025

Since we published our December Insights, tensions between the US, Russia and the Ukraine have intensified after a heated exchange at the White House in February between President Donald Trump and President Volodymyr Zelensky. On 19 January, Israel and Hamas agreed to a hostages-and-prisoners exchange and armistice to end the Gaza war.

UK inflation jumped sharply from 2.5% in December 2024 to 3% in January 2025. In February, The Bank of England cut interest rates from 4.75% to 4.5%, their lowest level for 18 months.

From April 2025, the minimum wage for all groups will rise which will benefit more than three million workers, however, for some businesses this could lead to cut backs in hiring.

Despite concerns that AI will replace workers, research from the World Economic Forum suggests that AI will create approximately 97 million new jobs by the end of this year. (Source: World Economic Forum)

Here we summarise the key issues, along with the relevant insurance implications, that are likely to be affecting some customers.

Inflationary issues

December 2024

Since we published our September Insights, Labour has delivered its first budget in 14 years, Donald Trump was elected as president of the United States, and the United Nations Climate Change Conference, COP29, was held in Azerbaijan. 

In October 2024, tensions in the Middle East between Israel and Hamas escalated into an Israeli invasion of Lebanon, and on 17th October, IDF ground forces killed Hamas leader Yahya Sinwar.  

Global economic growth remains weak by historical standards but is showing signs of stabilisation. The annual UK inflation rate was 1.7% in November 2024. 

We’ve also seen a rapid acceleration in the use of artificial intelligence (AI) across the globe and 15% of UK businesses are now using some form of AI technology. 

Here we summarise the key issues, along with the relevant insurance implications, that are likely to be affecting some customers. 

Take a look at our underinsurance hub, where you can find all of our insight articles, webinars, podcasts ,and guidance notes that can help address the risks of underinsurance.

Inflationary issues

September 2024

Since we published our June Insights many significant political and economic changes have taken place around the world. In the UK, a Labour government was elected in a landslide general election victory, and in America, President Joe Biden announced he would not seek re-election and Donald Trump survived an assassination attempt.

Additionally, we’ve seen increased tensions in the Middle East between Israel, Iran and Yemen and a leadership change in Iran following the death of President Ebrahim Raisi in a helicopter crash in May 2024.

The US presidential election takes place in November 2024 and the outcome will affect foreign policy and international trade, which will impact the UK and Europe.

Global economic growth remains weak by historical standards but is showing signs of stabilisation. The annual UK inflation rate was 2.2% in July 2024, its lowest level in nearly three years.

Here we summarise the key issues, along with the relevant insurance implications, that are likely to be affecting some customers.

Inflationary issues

June 2024

Since we published our March insights, we’ve continued to see prices increase but the Office for Budget Responsibility expects living standards to recover more quickly than previously forecast and real household disposable income per person should recover its pre-pandemic peak by 2025-26.

2024 is set to be the biggest election year in history, with an unprecedented number of general elections taking place across the world. This will generate regulatory and policy uncertainty in the short and medium term.

The annual inflation rate is forecast to fall to the Bank of England’s 2% target in the coming months and to 1.9% in 2026. There was economic growth of 0.4% for the first three months of 2024 and 0.2% from April to June.

Here we summarise the key issues, along with the relevant insurance implications, that are likely to be affecting some customers.

Take a look at our underinsurance hub, where you can find all of our insight articles, webinars, podcasts and guidance notes that can help address the risks of underinsurance.

Inflationary issues

June 2024

Since we published our December insights, the war between Israel and Hamas has intensified and the war between Russia and Ukraine shows no sign of resolution. It’s anticipated that major 2024 elections around the world may further destabilise the global economy.

The UK’s annual inflation rate is expected to continue falling in 2024, though more gradually than in 2023, due to lower energy prices and reduced inflation in consumer goods and food. The annual inflation rate remains at 4%, which is unchanged from December.

Here we summarise the key issues, along with the relevant insurance implications, that are likely to be affecting some customers.

Take a look at our underinsurance hub, where you can find all of our insight articles, webinars, podcasts and guidance notes that can help address the risks of underinsurance.

Inflationary issues

2023

Inflationary issues

2022