Between 1920 and 2022, the Consumer Price Index went from 20 to 292.655.
Cumulatively, prices increased 1363.3%, which works out to an average of
2.67% per year. Put differently, a dollar in 1920 bought what
$0.07 buys in 2022.
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.
The headline number is an average. Individual categories moved very differently over this
period. Here is what $100 of 1920 spending costs in 2022, by category:
Category
Avg. yearly inflation
$100 in 1920 →
All items (CPI-U)
2.67%
$1,463
Food
2.66%
$1,454
Apparel
1.07%
$295
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–).
Long periods are sampled every 5 years; the calculator above covers any pair of years.
The destination year: 2022
2022 was the year inflation returned. Consumer prices rose 8.0% on average,
the worst since 1981, driven by pandemic-era supply chains, stimulus-fueled
demand, and an energy shock from the war in Ukraine. Gas briefly topped $5 a
gallon nationally for the first time ever, and “inflation” became the
top-ranked economic concern in nearly every poll of American households.
MLA: “Inflation from 1920 to 2022: $100 is worth $1,463 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1920-to-2022/
APA: InflationCalculator.com. Inflation from 1920 to 2022. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1920-to-2022/