CPI inflation calculator shows US prices rising in 2021
Today, the US Department of Labor released the Consumer Price Index (CPI) for November, and inflation hit a 39-year high. Wall Street analysts and economists generally expected to see the highest inflation in nearly four decades, CNBC reports. Experts have bet that the CPI will increase by around 0.7% in November 2021 (the reported figure was 6.8%), or 6.7% in total over the past year. This year-over-year increase nearly matches the CPI increase in June 1982, which peaked at 7% year-on-year.
What exactly is the CPI? The Consumer Price Index tracks dozens of goods consumers buy on a regular basis, from gasoline to food to pet supplies, and changes in those prices over time show inflation. which occurred. Because of this inflation, we are of course paying more for certain goods than in the past. In other words, the CPI tracks inflation in the prices of goods, which reveals how much less your dollar is doing now than before.
But how much less is your money worth today, in purchasing power, than it was in the past? There’s a nifty CPI inflation calculator from the US Bureau of Labor Statistics that can help you quickly calculate the relative purchasing power of your money. Simply enter the amount of money you want to calculate, the month and year in the past you would have (theoretically or actually) spent the money, and the calculator will show you how much money you would pay for the item in dollars today.
For example, say you paid $5,000 cash for a selected good in May 1989. The calculator reveals that in October 2021 you would have needed $11,170.80 to equal the purchasing power of those 5 $000 in May 1989. That’s inflation for you, and that’s one of the reasons that goods become more expensive for most people over time, which can lead to a decrease in their power real purchase if their salaries do not increase in line with the rate of inflation.
This story has been updated.