Consumer prices rose 2.7% in 2004, with a 29-cent jump in the price of gasoline, to $1.88 a gallon, doing much of the work. Crude oil passed $50 a barrel in October on rising demand from China and India. The Federal Reserve raised rates for the first time in four years on June 30, to 1.25%, and it kept going: 17 consecutive quarter-point increases took the rate to 5.25% by June 2006. Housing was already running ahead of incomes. The median household earned about $44,300, up 2.3% from 2003, while the median new home sold for $221,000, up about 13%. A first-class stamp stayed at 37 cents and the federal minimum wage at $5.15, unchanged since 1997.
Year in review
Inflation in 2004
The U.S. inflation rate in 2004 was 2.7% (CPI: 188.9). Convert 2004 dollars to today →
2.7% 2004 inflation rate
2.6% 2000s average
3.5% peak month (Nov)
1.7% lowest month (Feb)
What things cost in 2004
In 2004, the median household income was $44,334, and a gallon of gas cost $1.88.
| Median household income | $44,334 |
|---|---|
| Gas (per gallon) | $1.88 |
| Median home price | $221,000 |
| First-class stamp | $0.37 |
| Federal minimum wage | $5.15 |
What $100 from 2004 was worth later
$100 from 2004 had the buying power of $176 by 2026; each milestone links to that conversion.
| In 2010 | $115 |
|---|---|
| In 2020 | $137 |
| In 2026 | $176 |
Inflation in 2004, month by month
| Month | CPI-U | 12-month rate |
|---|---|---|
| January | 185.2 | 1.9% |
| February | 186.2 | 1.7% |
| March | 187.4 | 1.7% |
| April | 188 | 2.3% |
| May | 189.1 | 3.1% |
| June | 189.7 | 3.3% |
| July | 189.4 | 3.0% |
| August | 189.5 | 2.7% |
| September | 189.9 | 2.5% |
| October | 190.9 | 3.2% |
| November | 191 | 3.5% |
| December | 190.3 | 3.3% |
Economic events of 2004
The Fed begins raising rates in June after holding at 1.0% for a year; prices rose 2.7% that year.
- The Fed begins raising rates in June after holding at 1.0% for a year The June 30 increase to 1.25% started a run of 17 straight quarter-point hikes that took the policy rate to 5.25% by June 2006.
- Oil passes $50 a barrel in October Rising demand from China and India and limited spare production capacity pushed crude to a record in nominal terms, and gasoline averaged $1.88 for the year, up about 18% from 2003.
- The housing boom accelerates The median new home price rose about 13% in a single year, to $221,000, as low mortgage rates and looser lending standards, including adjustable-rate and low-documentation loans, drew in more buyers.
Sources: U.S. Census Bureau, Current Population Survey (income); U.S. Census Bureau, New Residential Sales (home price); U.S. Energy Information Administration (gasoline); U.S. Department of Labor (minimum wage); USPS historical rates.
Inflation figures: U.S. Bureau of Labor Statistics, CPI-U annual averages. See the methodology.