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U.S. Inflation Rate History

U.S. inflation history stretches back to 1913, when the Bureau of Labor Statistics began tracking the Consumer Price Index. Over more than a century, the U.S. has experienced hyperinflation during WWI, deflation during the Great Depression, wartime inflation during WWII, the Great Inflation of the 1970s, a long period of low inflation from 1983-2020, and the post-COVID inflation surge that peaked at 9.1% in 2022.

CPI Inflation (YoY)

2.43%

Bureau of Labor Statistics

Notable inflation episodes: The 1918 peak of 20.4% was driven by WWI spending. Deflation of -10.5% in 1921 followed. The Great Depression saw prices fall 10.3% in 1932. WWII brought rationing-suppressed inflation. The 1970s energy crises pushed inflation above 13% by 1979. Volcker's rate shock in 1981 broke the inflation cycle, ushering in 40 years of relative price stability until COVID-era stimulus and supply chain disruptions pushed CPI to 9.1% in June 2022.

? Frequently Asked Questions

When was inflation highest in U.S. history?

The highest single-year U.S. inflation rate was approximately 20% in 1918 during WWI. In modern history, the peak was 13.5% in 1980 during the second oil shock.

What caused the 2021-2022 inflation spike?

Multiple factors converged: $5+ trillion in COVID stimulus flooded the economy; supply chains were severely disrupted; energy prices surged after Russia's Ukraine invasion; and years of near-zero interest rates had suppressed price discovery.

How did Volcker stop inflation in the 1980s?

Fed Chair Paul Volcker raised the federal funds rate to 20% in 1981, causing a severe recession but ultimately breaking the inflation spiral. Inflation fell from 13.5% in 1980 to under 3% by 1983.

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