Climate Change: Another Reason for Inflation in Coming Years

A study by the Potsdam Institute for Climate Impact Research and the European Central Bank revealed how inflation could spiral out of control in a hotter future.


The study looked into how climate change could raise global food inflation and how this might effect "headline" or overall inflation on a year-over-year basis in terms of percentage.

Iraq, Mali, Mauritania, and Saudi Arabia, which are already heated, will experience the greatest increases in food and overall inflation. According to the SSP8.5 scenario, India's food inflation would rise by about 2% and overall inflation by 1% by 2035. 

Higher latitudinal regions, such as the United States and Europe, would be more susceptible to inflationary pressure during the summer months. The same pattern was seen across Europe during the record summer months of 2022. Furthermore, the study found that adaption efforts to past and future climate change had no impact on inflationary pressures.

In addition to these climate change projections, the India Meteorological Department (IMD) anticipates a sweltering summer in 2024, with temperatures already surging across India. Between March 27 and April 1, four states had heatwaves or warm nights, while the remainder of India is expected to experience above-average maximum temperatures in April, May, and June.