U.S. inflation · 1985–1990

Value of $100 in 1985, adjusted to 1990

$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

$100$111$12119851990$100 · 1985$121 · 1990
Detailed inflation statistics
Cumulative price change21.5%
Average inflation rate3.97% per year
Converted amount ($100 base)$121
Price difference ($100 base)$21.47
CPI in 1985107.6
CPI in 1990130.7
Inflation in 19853.56%
Inflation in 19905.40%
$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.

More about inflation in 1985 →

Common amounts: 1985 dollars in 1990

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 1985Value 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.

Year CPI Inflation rate $100 from 1985
1985 107.6 3.6% $100
1986 109.6 1.9% $102
1987 113.6 3.6% $106
1988 118.3 4.1% $110
1989 124 4.8% $115
1990 130.7 5.4% $121

The destination year: 1990

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.

More about inflation in 1990 →

Cite this page

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/

Source: U.S. Bureau of Labor Statistics, CPI-U annual averages (series CUUR0000SA0; category indexes listed on the data sources page). See how these numbers are calculated.