CA\$

# Canadian inflation rate in 1921: -16.07%

### Inflation in 1921 and Its Effect on Dollar Value

Purchasing power increased by 16.07% in 1921 compared to 1920. On average, you would have to spend 16.07% less money in 1921 than in 1920 for the same item. This is an example of deflation.

In other words, CA\$1 in 1920 is equivalent in purchasing power to about CA\$0.84 in 1921.

The 1920 inflation rate was 9.80%. The inflation rate in 1921 was -16.07%. The 1921 inflation rate is lower compared to the average inflation rate of 2.74% per year between 1921 and 2019.

Inflation rate is calculated by change in the consumer price index (CPI). The CPI in 1921 was 9.40. It was 11.20 in the previous year, 1920. The difference in CPI between the years is used by Statistics Canada to officially determine inflation. Because the 1921 CPI is less than 1920 CPI, negative inflation (also known as deflation) has occurred.

 Average inflation rate -16.07% Converted amount (CA\$1 base) CA\$0.84 Price difference (CA\$1 base) CA\$-0.16 CPI in 1920 11.200 CPI in 1921 9.400 Inflation in 1920 9.80% Inflation in 1921 -16.07%

### How to Calculate Inflation Rate for CA\$1, 1920 to 1921

This inflation calculator uses the following inflation rate formula:

CPI in 1921CPI in 1920
×
=

Then plug in historical CPI values. The Canadian CPI was 11.2 in the year 1920 and 9.4 in 1921:

9.411.2
×
CA\$1
=
CA\$0.84

CA\$1 in 1920 has the same "purchasing power" or "buying power" as CA\$0.84 in 1921.

To get the total inflation rate for the 1 years between 1920 and 1921, we use the following formula:

CPI in 1921 - CPI in 1920CPI in 1920
×
100
=
Cumulative inflation rate (1 years)

Plugging in the values to this equation, we get:

9.4 - 11.211.2
×
100
=
-16%

Politics and news often influence economic performance. Here's what was happening at the time:

• The League of Nations' first assembly takes place in Paris.
• The British Parliament passes the Fourth Home Rule Act, dividing Ireland into two parts and leading to a yearlong Anglo-Irish war in the southern counties.
• The Catholic Church canonizes Joan of Arc, formally making her a saint.
• The 19th Amendment to the constitution is ratified, granting U.S. woman suffrage for the first time.

### Data Source & Citation

Raw data for these calculations comes from the government of Canada's annual Consumer Price Index (CPI), established in 1914 and computed by Statistics Canada (StatCan).

You may use the following MLA citation for this page: “Inflation Rate in 1921 | Canada Inflation Calculator.” U.S. Official Inflation Data, Alioth Finance, 14 Oct. 2019, https://www.officialdata.org/CAD-inflation-rate-in-1921.