Value of $100 in 2021, adjusted to 2024

What happened to prices between 2021 and 2024

Between 2021 and 2024, the Consumer Price Index went from 270.97 to 313.689. Cumulatively, prices increased 15.8%, which works out to an average of 5.00% per year. Put differently, a dollar in 2021 bought what $0.86 buys in 2024: the 2021 dollar lost 13.6% of its purchasing power over these 3 years.

2021 was the year inflation stopped being background noise. Consumer prices rose 4.7% on average for the year, and the pace kept building as the months went on: by December, the 12-month rate had reached 7.0%, the highest since 1982. The proximate cause was a supply chain that could not keep up with a fast-reopening economy. A global semiconductor shortage choked new car production and pushed used vehicle prices up by more than a third, the single largest line item in the year’s inflation math. Lumber, appliances, and shipping capacity told versions of the same story: demand snapped back faster than factories, ports, and truckers could handle it. Washington added fuel in March with the $1.9 trillion American Rescue Plan, on top of the relief already in the pipeline since 2020. For most of the year, the Federal Reserve called the price surge “transitory,” a temporary reopening effect expected to fade on its own, and held its policy rate near zero. By November, with inflation still climbing, the Fed reversed course and began winding down its bond purchases, the first step toward the rate hikes that would follow in 2022. Gas averaged $3.01 a gallon for the year, up from about $2.17 in 2020, while the federal minimum wage held at $7.25, unchanged since 2009. In hindsight, 2021 reads as the hinge year: the point where “transitory” inflation became the multi-year fight the Fed spent the next two years trying to win.

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The destination year: 2024

In 2024, prices rose 2.9% and $100 from 2021 had the buying power of $116; the year's average CPI of 313.689 is the level behind every 2024 figure on this page.

2024 brought inflation close to normal without fully reaching it. Consumer prices rose 2.9% on average, the smallest yearly increase since 2020, and the December-to-December rate was also 2.9%. Gasoline averaged $3.30 a gallon, below 2023’s $3.52. Shelter stayed the biggest driver of the index, so the pace of price growth in categories that households can’t easily avoid, such as rent and insurance, lagged the drop in goods and energy costs.

The Federal Reserve declared progress in September, cutting its policy rate by half a point, the first reduction since the pandemic emergency, and then by a quarter point in November and again in December. Mortgage rates near 7% kept the housing market frozen for many would-be buyers.

Median household income was $83,730, the federal minimum wage stayed at $7.25, and a first-class stamp rose to 73 cents in July. After the November election, attention turned to how announced tariffs and tax policy might affect prices in 2025.

More about inflation in 2024 →