Value of $100 in 1972, adjusted to 2023

What happened to prices between 1972 and 2023

Between 1972 and 2023, the Consumer Price Index went from 41.8 to 304.702. Cumulatively, prices increased 629.0%, which works out to an average of 3.97% per year. Put differently, a dollar in 1972 bought what $0.14 buys in 2023: the 1972 dollar lost 86.3% of its purchasing power over these 51 years.

Consumer prices rose just 3.2% in 1972, the calmest year of the decade and a sharp break from the previous two years. The relief was largely engineered: Nixon’s wage and price controls, imposed as a 90-day freeze in August 1971, had settled into a series of “phases” that capped how much businesses could raise prices through the election year. Economists would later argue the controls mostly deferred inflation rather than curing it, storing up pressure that broke loose once they were lifted. Nixon spent political capital on foreign policy that year, traveling to Beijing that February in the first visit by a sitting U.S. president to the People’s Republic of China, a trip that began normalizing relations Washington had frozen since 1949. Closer to home, five men were arrested breaking into the Democratic National Committee’s offices at the Watergate complex that June 17, an event that drew little attention at the time but would eventually force Nixon from office. None of it dented his re-election bid: Nixon carried 49 states against Democrat George McGovern that November, helped by an economy that, on paper, looked more stable than it had in years. A median household earned $9,697 in 1972, a new home sold for a median $27,600, and gas held near 36 cents a gallon for a third straight year. Consumer prices stood 322.2% above their 1913 level, a lull that would not survive contact with the controls’ expiration and the oil shock still to come.

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The destination year: 2023

In 2023, prices rose 4.1% and $100 from 1972 had the buying power of $729; the year's average CPI of 304.702 is the level behind every 2023 figure on this page.

2023 was the year inflation came down without a recession. Consumer prices rose 4.1% on average, roughly half of 2022’s 8.0%, and the December-to-December rate fell to 3.4%. Gasoline averaged $3.52 a gallon, well below the 2022 average, and supply-chain pressure on goods eased. Shelter, restaurant meals, and other services stayed expensive, so the CPI kept rising at a rate well above the pre-pandemic pace.

The Federal Reserve completed its rate-hiking campaign in July, taking the policy rate to 5.25–5.50%, the highest level in 22 years. The effects showed up in banking: Silicon Valley Bank failed in March after rate increases eroded the value of its bond portfolio, the second-largest bank failure in U.S. history at the time. Despite that, unemployment stayed under 4% all year.

Median household income was $80,610 according to the Census Bureau. The federal minimum wage stayed at $7.25, and a first-class stamp rose to 66 cents in July.

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