Inflation rates may be falling, but people expect further price rises

Key points:

• There is a strong expectation that prices will rise next year. Two-thirds (65%) think the rate of inflation will increase in their country in the next 12 months. This figure is up 7pp since April.
• People more likely to feel worse off than four years ago. Thirty-seven per cent across 32 countries say they are worse off than before the pandemic.
• More see immigration as a driver of inflation. The proportion who choose immigration as a cause of inflation is up 4pp since April to 56%. 
• The gap between the wealthy and the rest is growing. Those on a low and middle income are more likely to say they are finding it difficult compared to earlier this year. 
• Overall, more people want tax cuts than more public spending. However, this masks big differences across countries.

Inflation rates are on their way down in many countries, but does this mean people feel like they can breathe easy?

While the speed of price rises is much lower than they were, the cumulative effect of prices rises over the last few years is hitting home.

Looking at the proportion of people who say inflation is an issue in our What Worries the World survey, we see concern rise in line with increasing prices, but as the rate of inflation falls concern about rising prices declines at a much slower pace – and remains highly sensitive to even small upticks in the cost of living.

As we look ahead into 2025 people are more likely to think inflation rates will rise than in the new year than they did in the previous edition of this survey.

Sixty per cent on average across 32 countries think the rate of inflation will rise over the next year, up from 58% in April.

This is something that is felt across the board. In 21 of the 32 countries surveyed people are more likely to think prices will rise at a faster rate than they did earlier this year.

Where are price rises expected?

Across all categories we see the proportion of people expecting to pay more on the increase.

In April, 67% thought the price of their food shopping would rise, 72% now expect to be paying more.

The same feeling is true for other household shopping, utilities, motoring costs, socialising, subscriptions and mortgage or rent. 

This is reflected in the proportion who think they will have less disposable income rising in many countries, especially in Europe.

Cost reality vs cost perception

While inflation rates are going down, people are not feeling it in the way policy makers and central banks would have hoped.

Official data tells us that inflation rates in many countries are at their lowest for 3-4 years. And more people on average across 32 countries say they are doing alright/living comfortably than are finding it difficult (37% to 28%).

However, this masks differences across income levels and countries. In many countries, including the most advanced economies, we now have more people telling us they are struggling financially than at any point over the two and a half years we have been tracking sentiment in this way. In Italy, Australia, the United States, and Japan the number of people finding it financially difficult is rising.

Added to this many in Western markets tell us they are feeling worse off now than they were before the COVID-19 pandemic. Thirty-seven per cent across 32 markets say they are worse off.

Read analysis from Ipsos CEO Ben Page

About this study

These are the results of a 32-country survey conducted by Ipsos on its Global Advisor online platform and, in India, on its IndiaBus platform, between Friday, October 25 and Friday, November 8, 2024. For this survey, Ipsos interviewed a total of 22,720 adults aged 18 years and older in India, 18-74 in Canada, Republic of Ireland, Malaysia, the Philippines, South Africa, Türkiye, and the United States, 20-74 in Thailand, 21-74 in Indonesia and Singapore, and 16-74 in all other countries. Full methodology is in the report below.