$100 in 1920 is worth $87.50 in 1925,
because prices declined 12.5% over that period, an average of
2.64% a year.
$100 in 1920 has
the same buying power as
$87.50
in 1925
Detailed inflation statistics
Cumulative price change
-12.5%
Average inflation rate
-2.64% per year
Converted amount ($100 base)
$87.50
Price difference ($100 base)
-$12.50
CPI in 1920
20
CPI in 1925
17.5
Inflation in 1920
15.61%
Inflation in 1925
2.34%
$100 in 1920 → 1925
$87.50
$100 in 1925 → 1920
$114
What happened to prices between 1920 and 1925
Between 1920 and 1925, the Consumer Price Index went from 20 to 17.5.
Cumulatively, prices declined 12.5%, which works out to an average of
-2.64% per year. Put differently, a dollar in 1920 bought what
$1.14 buys in 1925: the 1920 dollar
gained 14.3% in purchasing power over
these 5 years.
1920 was the last year of the inflation that had built since the war began:
consumer prices rose 15.6% for the year, leaving the CPI more than double its
1913 starting level after seven straight years of increases.
The boom behind those increases turned to bust before the year was over. The
Federal Reserve, worried about speculation, pushed its discount rate to a
record 7% that spring, and wholesale prices, which had led the wartime
runup, began collapsing within months. The National Bureau of Economic
Research dates the resulting downturn from January 1920 to July 1921, one of
the shortest but steepest contractions in U.S. history, and consumer prices
followed into outright decline, falling 10.5% in 1921. Two constitutional
changes reshaped the country that year, too. The 18th Amendment’s ban on
alcohol took legal effect January 17, enforced under the Volstead Act
Congress had passed the previous October. Then, on August 18, Tennessee’s
ratification of the 19th Amendment secured women’s right to vote nationwide,
and women cast ballots in a presidential election for the first time that
November, when Warren Harding won on a promise to return the country to
“normalcy” after a decade of war, pandemic, and rising prices. First-class
postage held at 2 cents, unchanged since mid-1919.
Every 1920 amount converts to 1925 at the same ratio, 0.88: $1,000 becomes
$875, and $10,000 becomes $8,750.
Amount in 1920
Value in 1925
$1.00
$0.88
$5.00
$4.38
$10.00
$8.75
$20.00
$17.50
$50.00
$43.75
$100
$87.50
$500
$438
$1,000
$875
$5,000
$4,375
$10,000
$8,750
$100,000
$87,500
$1,000,000
$875,000
Inflation by spending category, 1920–1925
Every category fell between 1920 and 1925: apparel the most, down 39.0%, and food the least, down 21.4%. The headline number is an average; here is what $100 of 1920
spending costs in 1925, by category:
Category
Avg. yearly inflation
$100 in 1920 →
All items (CPI-U)
-2.64%
$87.50
Food
-4.71%
$78.57
Apparel
-9.41%
$61.02
Not shown because the BLS began these indexes after 1920: core (all items less food & energy) (1957–), energy (1957–), housing (1967–), medical care (1935–), transportation (1935–), recreation (1993–), education & communication (1993–).
Year by year: CPI and the value of $100 from 1920
$100 from 1920 had already become $84.00 by
1922, on its way to $87.50 in 1925; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 2.3% in 1925, and prices fell 10.5% in 1921, the deepest deflation of the period.
In 1925, prices rose 2.3% and $100 from 1920 had the buying
power of $87.50; the year's average CPI of 17.5 is the level
behind every 1925 figure on this page.
Consumer prices rose 2.3% in 1925, the CPI’s largest single-year increase
since the deflationary swings of the early 1920s, though still mild next to
the double-digit inflation of the World War I years. The country’s cultural
fault lines were on full display that summer in Dayton, Tennessee, where
high school teacher John Scopes was tried July 10-21 for violating a state
law against teaching evolution, a case that drew national press coverage and
pitted prosecutor William Jennings Bryan against defense attorney Clarence
Darrow. Real estate speculation, meanwhile, peaked in Florida, where buyers
flipped undeveloped land in the Miami area on thin down payments, driving
prices far above what the land itself could support; the bubble would
collapse the following year. Detroit reshuffled that June too: Walter
Chrysler reorganized the struggling Maxwell Motor Company into Chrysler
Corporation, the start of what would become one of the American auto
industry’s “Big Three.” First-class postage held at 2 cents for the sixth
straight year.
MLA: “Inflation from 1920 to 1925: $100 is worth $87.50 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1920-to-1925/
APA: InflationCalculator.com. Inflation from 1920 to 1925. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1920-to-1925/