$100 in 1978 is worth $190 in 1989,
because prices increased 90.2% over that period, an average of
6.02% a year.
$100 in 1978 has
the same buying power as
$190
in 1989
Detailed inflation statistics
Cumulative price change
90.2%
Average inflation rate
6.02% per year
Converted amount ($100 base)
$190
Price difference ($100 base)
$90.18
CPI in 1978
65.2
CPI in 1989
124
Inflation in 1978
7.59%
Inflation in 1989
4.82%
$100 in 1978 → 1989
$190
$100 in 1989 → 1978
$52.58
What happened to prices between 1978 and 1989
Between 1978 and 1989, the Consumer Price Index went from 65.2 to 124.
Cumulatively, prices increased 90.2%, which works out to an average of
6.02% per year. Put differently, a dollar in 1978 bought what
$0.53 buys in 1989: the 1978 dollar
lost 47.4% of its purchasing power over
these 11 years.
Consumer prices rose 7.6% in 1978, accelerating for a second straight year as
rising wages, a weakening dollar, and climbing energy costs outpaced the
Federal Reserve’s response. Fed chairman G. William Miller, appointed by
Carter that March, kept interest rates too low to slow the trend, a policy
later cited as one reason inflation kept building toward the following year’s
crisis. California voters responded to their own version of the problem that
June, passing Proposition 13 by nearly two to one to cap property tax rates
after years of rising home values had pushed tax bills up alongside them.
Foreign policy delivered one of the decade’s genuine breakthroughs: President
Carter brought Egyptian President Anwar Sadat and Israeli Prime Minister
Menachem Begin together for thirteen days of negotiations at Camp David that
September, producing a framework for peace between the two countries that was
signed as a treaty the following March. First-class postage rose to 15 cents
that May 29, a rate that would hold longer than any other in the decade. The
year ended in tragedy: cult leader Jim Jones directed the mass murder-suicide
of more than 900 followers at a remote settlement in Guyana that November 18.
A median household earned $15,064 in 1978, a new home sold for a median
$55,700, and gas averaged 63 cents a gallon. Consumer prices stood 558.6%
above their 1913 level, with the decade’s worst inflation
still to come.
Every 1978 amount converts to 1989 at the same ratio, 1.90: $1,000 becomes
$1,902, and $10,000 becomes $19,018.
Amount in 1978
Value in 1989
$1.00
$1.90
$5.00
$9.51
$10.00
$19.02
$20.00
$38.04
$50.00
$95.09
$100
$190
$500
$951
$1,000
$1,902
$5,000
$9,509
$10,000
$19,018
$100,000
$190,184
$1,000,000
$1,901,840
Inflation by spending category, 1978–1989
Between 1978 and 1989, medical care rose the most, up 141.6%, while apparel rose the least, up 45.7%, against 90.2% for all items. The headline number is an average; here is what $100 of 1978
spending costs in 1989, by category:
Category
Avg. yearly inflation
$100 in 1978 →
All items (CPI-U)
6.02%
$190
Medical care
8.35%
$242
Housing
6.36%
$197
Core (all items less food & energy)
6.36%
$197
Transportation
5.75%
$185
Energy
5.47%
$180
Food
5.15%
$174
Apparel
3.48%
$146
Not shown because the BLS began these indexes after 1978: recreation (1993–), education & communication (1993–).
Decade by decade: 1978 to 1989
Prices climbed fastest in the 1970s, averaging 12.42% a year, and slowest in the 1980s (4.65% a year). Each step below chains into the full 1978–1989 change:
Years
Avg. yearly inflation
Price change
$100 from 1978, at end
1978–1980
12.42%
26.4%
$126
1980–1989
4.65%
50.5%
$190
Year by year: CPI and the value of $100 from 1978
$100 from 1978 had already become $153 by
1983, on its way to $190 in 1989; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 13.5% in 1980, and the smallest rise was 1.9% in 1986.
In 1989, prices rose 4.8% and $100 from 1978 had the buying
power of $190; the year's average CPI of 124 is the level
behind every 1989 figure on this page.
1989 closed out a decade that began in economic crisis and ended in a long,
calmer expansion. Inflation for the year came in at 4.8%, higher than the
mid-decade lull but still roughly a third of the 13.5% peak that had opened
the decade in 1980. The federal minimum wage, unchanged at $3.35 an hour
since January 1981, had gone longer without an increase than at any point
since Congress created it, and had lost close to a third of its purchasing
power to inflation in the meantime; lawmakers would finally raise it to
$3.80 the following April. The decade’s other unfinished business came due
in August, when Congress passed FIRREA, the law that created the Resolution
Trust Corporation to seize and sell off the hundreds of savings and loan
institutions that a decade of deregulation and risky lending had left
insolvent, a bailout that eventually cost taxpayers over $100 billion. On
Wall Street, the recovery was already complete: the Dow Jones Industrial
Average closed 1989 at a record high, just over two years after Black
Monday’s 22.6% single-day crash, capping the bull market that had begun at
the Dow’s 776 low in August 1982. Between the S&L bailout, a wage floor
eroded by years without a raise, and a stock market at new highs, 1989
captured how unevenly the decade’s disinflation had been felt.
MLA: “Inflation from 1978 to 1989: $100 is worth $190 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1978-to-1989/
APA: InflationCalculator.com. Inflation from 1978 to 1989. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1978-to-1989/