Inflation averaged 3.8% in 2008, but that figure hides a swing. The 12-month rate reached 5.6% in July, when oil hit $147 a barrel and gasoline passed $4 a gallon, then fell to 0.1% by December as crude dropped near $40. For the year, gas averaged $3.27, the highest yet. The financial system broke in the fall: Lehman Brothers filed for bankruptcy on September 15, Congress created the $700 billion TARP bank rescue on October 3, and the Federal Reserve cut its policy rate to a range of 0–0.25% in December. The median household earned about $50,300, barely above 2007, and the median new home price fell to $232,100. The minimum wage rose to $6.55 in July, and a first-class stamp cost 42 cents. The price collapse at the end of 2008 set up the deflation of 2009.
Year in review
Inflation in 2008
The U.S. inflation rate in 2008 was 3.8% (CPI: 215.303). Convert 2008 dollars to today →
3.8% 2008 inflation rate
2.6% 2000s average
5.6% peak month (Jul)
0.1% lowest month (Dec)
What things cost in 2008
In 2008, the median household income was $50,303, and a gallon of gas cost $3.27.
| Median household income | $50,303 |
|---|---|
| Gas (per gallon) | $3.27 |
| Median home price | $232,100 |
| First-class stamp | $0.42 |
| Federal minimum wage | $6.55 |
What $100 from 2008 was worth later
$100 from 2008 had the buying power of $154 by 2026; each milestone links to that conversion.
| In 2010 | $101 |
|---|---|
| In 2020 | $120 |
| In 2026 | $154 |
Inflation in 2008, month by month
| Month | CPI-U | 12-month rate |
|---|---|---|
| January | 211.08 | 4.3% |
| February | 211.693 | 4.0% |
| March | 213.528 | 4.0% |
| April | 214.823 | 3.9% |
| May | 216.632 | 4.2% |
| June | 218.815 | 5.0% |
| July | 219.964 | 5.6% |
| August | 219.086 | 5.4% |
| September | 218.783 | 4.9% |
| October | 216.573 | 3.7% |
| November | 212.425 | 1.1% |
| December | 210.228 | 0.1% |
Economic events of 2008
Oil peaks at $147 a barrel on July 11, and the 12-month inflation rate reaches 5.6%; prices rose 3.8% that year.
- Oil peaks at $147 a barrel on July 11, and the 12-month inflation rate reaches 5.6% Gasoline topped $4 a gallon nationally that summer. Prices then reversed, and crude was near $40 by December, taking the 12-month CPI rate to 0.1%.
- Lehman Brothers files for bankruptcy on September 15 The largest bankruptcy in U.S. history came a week after the government took over Fannie Mae and Freddie Mac, and it froze short-term credit markets worldwide.
- Congress creates the $700 billion Troubled Asset Relief Program Signed on October 3, after the House rejected a first version, the program let the Treasury buy bank assets and, in practice, inject capital into banks directly.
- The Fed cuts its policy rate to a range of 0–0.25% in December The Fed cut from 4.25% at the start of the year to near zero by December 16, the lowest level on record.
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.