$100 in 1981 is worth $179 in 1998,
because prices increased 79.3% over that period, an average of
3.49% a year.
$100 in 1981 has
the same buying power as
$179
in 1998
Detailed inflation statistics
Cumulative price change
79.3%
Average inflation rate
3.49% per year
Converted amount ($100 base)
$179
Price difference ($100 base)
$79.32
CPI in 1981
90.9
CPI in 1998
163
Inflation in 1981
10.32%
Inflation in 1998
1.56%
$100 in 1981 → 1998
$179
$100 in 1998 → 1981
$55.77
What happened to prices between 1981 and 1998
Between 1981 and 1998, the Consumer Price Index went from 90.9 to 163.
Cumulatively, prices increased 79.3%, which works out to an average of
3.49% per year. Put differently, a dollar in 1981 bought what
$0.56 buys in 1998: the 1981 dollar
lost 44.2% of its purchasing power over
these 17 years.
1981 was the year the inflation fever finally broke, at an extraordinary price.
Consumer prices rose 10.3%, the second year of back-to-back double-digit
inflation and the last time the U.S. would see one. To end it, Paul Volcker’s
Federal Reserve drove its policy rate above 19% and let borrowing costs go
where they may: a 30-year mortgage cost more than 18% by autumn, car loans and
business credit froze, and homebuilders mailed the Fed two-by-fours in protest.
The squeeze tipped the economy into recession in July, the deep 1981–82
downturn that would push unemployment past 10%. But it worked. Inflation fell
by nearly half within a year and to under 4% by 1983, the disinflation that
defined the following two decades. Even the price of mailing a letter told the
year’s story: postage went up twice in eight months.
Every 1981 amount converts to 1998 at the same ratio, 1.79: $1,000 becomes
$1,793, and $10,000 becomes $17,932.
Amount in 1981
Value in 1998
$1.00
$1.79
$5.00
$8.97
$10.00
$17.93
$20.00
$35.86
$50.00
$89.66
$100
$179
$500
$897
$1,000
$1,793
$5,000
$8,966
$10,000
$17,932
$100,000
$179,318
$1,000,000
$1,793,179
Inflation by spending category, 1981–1998
Between 1981 and 1998, medical care rose the most, up 192.0%, while energy rose the least, up 5.3%, against 79.3% for all items. The headline number is an average; here is what $100 of 1981
spending costs in 1998, by category:
Category
Avg. yearly inflation
$100 in 1981 →
All items (CPI-U)
3.49%
$179
Medical care
6.51%
$292
Core (all items less food & energy)
3.99%
$194
Housing
3.43%
$177
Food
3.23%
$172
Transportation
2.49%
$152
Apparel
1.98%
$140
Energy
0.31%
$105
Not shown because the BLS began these indexes after 1981: recreation (1993–), education & communication (1993–).
Decade by decade: 1981 to 1998
Prices climbed fastest in the 1980s, averaging 4.12% a year, and slowest in the 1990s (2.80% a year). Each step below chains into the full 1981–1998 change:
Years
Avg. yearly inflation
Price change
$100 from 1981, at end
1981–1990
4.12%
43.8%
$144
1990–1998
2.80%
24.7%
$179
Year by year: CPI and the value of $100 from 1981
$100 from 1981 had already become $136 by
1989, on its way to $179 in 1998; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 6.2% in 1982, and the smallest rise was 1.6% in 1998.
In 1998, prices rose 1.6% and $100 from 1981 had the buying
power of $179; the year's average CPI of 163 is the level
behind every 1998 figure on this page.
The median household earned about $38,900 in 1998, gas averaged just $1.06 a gallon, its
cheapest of the decade, and a new home cost roughly $152,500. Inflation ran at 1.6% for the
year, the lowest of the 1990s, as a glut of crude oil, worsened by weak demand from Asia’s
slowdown, pushed prices below $11 a barrel by December and pulled pump prices down with them.
The calm at home came alongside real turmoil abroad: in August, Russia devalued the ruble and
defaulted on its domestic debt, rattling markets already unsettled by the Asian financial
crisis, and in September the hedge fund Long-Term Capital Management collapsed after its highly
leveraged bets went bad, prompting the Federal Reserve to organize a private-sector bailout by
more than a dozen banks to prevent a disorderly unwinding of its roughly $100 billion in
positions. The Fed also cut interest rates three times that fall, in September, October, and
November, an insurance policy against the global financial turmoil spreading to the U.S.
economy. Cheap oil and a well-timed set of rate cuts left 1998 as a year the U.S. economy
absorbed two foreign financial crises without much of a dent at home.
MLA: “Inflation from 1981 to 1998: $100 is worth $179 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1981-to-1998/
APA: InflationCalculator.com. Inflation from 1981 to 1998. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1981-to-1998/