$100 in 1985 is worth $121 in 1990,
because prices increased 21.5% over that period, an average of
3.97% a year.
$100 in 1985 has
the same buying power as
$121
in 1990
Detailed inflation statistics
Cumulative price change
21.5%
Average inflation rate
3.97% per year
Converted amount ($100 base)
$121
Price difference ($100 base)
$21.47
CPI in 1985
107.6
CPI in 1990
130.7
Inflation in 1985
3.56%
Inflation in 1990
5.40%
$100 in 1985 → 1990
$121
$100 in 1990 → 1985
$82.33
What happened to prices between 1985 and 1990
Between 1985 and 1990, the Consumer Price Index went from 107.6 to 130.7.
Cumulatively, prices increased 21.5%, which works out to an average of
3.97% per year. Put differently, a dollar in 1985 bought what
$0.82 buys in 1990: the 1985 dollar
lost 17.7% of its purchasing power over
these 5 years.
By 1985, low inflation had become the norm rather than the exception.
Consumer prices rose 3.6% for the year, the fourth straight year in the
3-6% range following the double-digit spikes of 1980 and 1981, proof that
the disinflation had held rather than merely paused, as it had after
previous recessions. Overseas, the dollar had become a problem of its own:
years of high U.S. interest rates had pulled in foreign capital and pushed
the dollar’s value up so far that American exporters were losing business
abroad, widening the trade deficit. In September, the finance ministers of
the U.S., Japan, West Germany, France, and the United Kingdom met at New
York’s Plaza Hotel and agreed to coordinate a managed decline of the
dollar; it fell roughly 25% against major currencies over the following two
years. At home, Congress responded to a federal deficit that had roughly
tripled since 1980 by passing the Gramm-Rudman-Hollings Act in December,
setting binding targets to shrink the deficit with automatic
across-the-board cuts if lawmakers missed them. Households felt the calmer
economy in small ways: first-class postage rose to 22 cents in February,
its first increase since November 1981, after nearly four years at 20
cents.
Every 1985 amount converts to 1990 at the same ratio, 1.21: $1,000 becomes
$1,215, and $10,000 becomes $12,147.
Amount in 1985
Value in 1990
$1.00
$1.21
$5.00
$6.07
$10.00
$12.15
$20.00
$24.29
$50.00
$60.73
$100
$121
$500
$607
$1,000
$1,215
$5,000
$6,073
$10,000
$12,147
$100,000
$121,468
$1,000,000
$1,214,684
Inflation by spending category, 1985–1990
Between 1985 and 1990, medical care rose the most, up 43.4%, while energy rose the least, up 0.5%, against 21.5% for all items. The headline number is an average; here is what $100 of 1985
spending costs in 1990, by category:
Category
Avg. yearly inflation
$100 in 1985 →
All items (CPI-U)
3.97%
$121
Medical care
7.48%
$143
Food
4.63%
$125
Core (all items less food & energy)
4.43%
$124
Housing
3.59%
$119
Apparel
3.40%
$118
Transportation
2.52%
$113
Energy
0.10%
$100
Not shown because the BLS began these indexes after 1985: recreation (1993–), education & communication (1993–).
Year by year: CPI and the value of $100 from 1985
$100 from 1985 had already become $106 by
1987, on its way to $121 in 1990; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 5.4% in 1990, and the smallest rise was 1.9% in 1986.
In 1990, prices rose 5.4% and $100 from 1985 had the buying
power of $121; the year's average CPI of 130.7 is the level
behind every 1990 figure on this page.
In 1990, the median U.S. household earned about $29,900, gas averaged $1.15 a
gallon, and mailing a letter cost a quarter. Inflation ran hot at 5.4% for the
year, its highest rate since 1982, pushed up by an oil shock after Iraq’s
invasion of Kuwait, and the economy tipped into recession that summer. It was
the last gasp of elevated inflation before the long calm of the 1990s.
MLA: “Inflation from 1985 to 1990: $100 is worth $121 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1985-to-1990/
APA: InflationCalculator.com. Inflation from 1985 to 1990. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1985-to-1990/