$100 in 1985 is worth $149 in 1997,
because prices increased 49.2% over that period, an average of
3.39% a year.
$100 in 1985 has
the same buying power as
$149
in 1997
Detailed inflation statistics
Cumulative price change
49.2%
Average inflation rate
3.39% per year
Converted amount ($100 base)
$149
Price difference ($100 base)
$49.16
CPI in 1985
107.6
CPI in 1997
160.5
Inflation in 1985
3.56%
Inflation in 1997
2.29%
$100 in 1985 → 1997
$149
$100 in 1997 → 1985
$67.04
What happened to prices between 1985 and 1997
Between 1985 and 1997, the Consumer Price Index went from 107.6 to 160.5.
Cumulatively, prices increased 49.2%, which works out to an average of
3.39% per year. Put differently, a dollar in 1985 bought what
$0.67 buys in 1997: the 1985 dollar
lost 33.0% of its purchasing power over
these 12 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 1997 at the same ratio, 1.49: $1,000 becomes
$1,492, and $10,000 becomes $14,916.
Amount in 1985
Value in 1997
$1.00
$1.49
$5.00
$7.46
$10.00
$14.92
$20.00
$29.83
$50.00
$74.58
$100
$149
$500
$746
$1,000
$1,492
$5,000
$7,458
$10,000
$14,916
$100,000
$149,164
$1,000,000
$1,491,636
Inflation by spending category, 1985–1997
Between 1985 and 1997, medical care rose the most, up 106.7%, while energy rose the least, up 9.7%, against 49.2% for all items. The headline number is an average; here is what $100 of 1985
spending costs in 1997, by category:
Category
Avg. yearly inflation
$100 in 1985 →
All items (CPI-U)
3.39%
$149
Medical care
6.24%
$207
Core (all items less food & energy)
3.74%
$155
Food
3.38%
$149
Housing
3.18%
$146
Transportation
2.57%
$136
Apparel
1.98%
$127
Energy
0.78%
$110
Not shown because the BLS began these indexes after 1985: recreation (1993–), education & communication (1993–).
Decade by decade: 1985 to 1997
Prices climbed fastest in the 1980s, averaging 3.97% a year, and slowest in the 1990s (2.98% a year). Each step below chains into the full 1985–1997 change:
Years
Avg. yearly inflation
Price change
$100 from 1985, at end
1985–1990
3.97%
21.5%
$121
1990–1997
2.98%
22.8%
$149
Year by year: CPI and the value of $100 from 1985
$100 from 1985 had already become $127 by
1991, on its way to $149 in 1997; 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 1997, prices rose 2.3% and $100 from 1985 had the buying
power of $149; the year's average CPI of 160.5 is the level
behind every 1997 figure on this page.
The median household earned about $37,000 in 1997, gas averaged $1.23 a gallon, and a new home
cost roughly $146,000. Inflation ran at 2.3% for the year, its lowest reading since the
mid-1980s, as a strong dollar and falling import prices helped keep costs in check at home even
as trouble built abroad. In July, Thailand devalued the baht, and the currency collapse that
followed spread within months to Indonesia, South Korea, and other Southeast Asian economies,
forcing IMF bailouts and years of recession across the region, though the crisis had little
immediate effect on U.S. prices. At home, Washington had a calmer year: in August, President
Clinton and Congress agreed on the Balanced Budget Act and the Taxpayer Relief Act, which cut
capital gains tax rates, created the Roth IRA, and set the federal budget on a path to its first
surplus in nearly three decades. In September, the federal minimum wage completed a two-step
rise to $5.15 an hour, where it would stay for a decade. Low inflation, a firming budget picture,
and a crisis unfolding an ocean away made 1997 a year the U.S. economy looked stronger than much
of the rest of the world’s.
MLA: “Inflation from 1985 to 1997: $100 is worth $149 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1985-to-1997/
APA: InflationCalculator.com. Inflation from 1985 to 1997. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1985-to-1997/