U.S. inflation rate in 1916: 7.92%

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Inflation in 1916 and Its Effect on Dollar Value

Purchasing power decreased by 7.92% in 1916 compared to the previous year, 1915. On average, you would have to spend 7.92% more money in 1916 than in 1915 for the same item.

In other words, $1 in 1915 is equivalent in purchasing power to $1.08 in 1916.

The 1915 inflation rate was 1.00%. The inflation rate in 1916 was 7.92%. The 1916 inflation rate is higher compared to the average inflation rate of 3.13% per year between 1916 and 2018.

Inflation rate is calculated by change in the consumer price index (CPI). The CPI in 1916 was 10.9. It was 10.1 in the previous year, 1915. The difference in CPI between the years is used by the Bureau of Labor Statistics to officially determine inflation.


Inflation from 1915 to 1916
Average inflation rate 7.92%
Converted amount ($1 base) $1.08
Price difference ($1 base) $0.08
CPI in 1915 10.100
CPI in 1916 10.900
Inflation in 1915 1.00%
Inflation in 1916 7.92%


U.S. Inflation since 1913
Annual Rate, U.S. Bureau of Labor Statistics CPI

Inflation by City

Inflation can vary widely by city, even within the United States. Here's how some cities fared in 1915 to 1916 (figures shown are purchasing power equivalents of $1):

Detroit, Michigan experienced the highest rate of inflation during the 1 years between 1915 and 1916 (5.14%).

Seattle, Washington experienced the lowest rate of inflation during the 1 years between 1915 and 1916 (-0.45%).

Note that some locations showing 0% inflation may have not yet reported latest data.


Inflation by Country

Inflation can also vary widely by country. For comparison, in the UK £1.00 in 1915 would be equivalent to £1.18 in 1916, an absolute change of £0.18 and a cumulative change of 18.18%.

In Canada, CA$1.00 in 1915 would be equivalent to CA$1.14 in 1916, an absolute change of CA$0.14 and a cumulative change of 14.29%.

Compare these numbers to the US's overall absolute change of $0.08 and total percent change of 7.92%.


Inflation by Spending Category

CPI is the weighted combination of many categories of spending that are tracked by the government. This chart shows the average rate of inflation for select CPI categories between 1915 and 1916.

Compare these values to the overall average of 7.92% per year:

Category Avg Inflation (%) Total Inflation (%) $1 in 1915 → 1916
Food 12.17 12.17 1.12
Shelter 0.00 0.00 1.00
Energy 0.00 0.00 1.00
Apparel 12.30 12.30 1.12
New vehicles 0.00 0.00 1.00
Used cars and trucks 0.00 0.00 1.00
Transportation services 0.00 0.00 1.00
Medical care services 0.00 0.00 1.00
Medical care commodities 0.00 0.00 1.00

It's important to note that not all categories may be tracked since 1915. This table and visualization use the earliest available data for each category.



How to Calculate Inflation Rate for $1, 1915 to 1916

This inflation calculator uses the following inflation rate formula:

CPI in 1916CPI in 1915
×
1915 USD value
=
1916 USD value

Then plug in historical CPI values. The U.S. CPI was 10.1 in the year 1915 and 10.9 in 1916:

10.910.1
×
$1
=
$1.08

$1 in 1915 has the same "purchasing power" or "buying power" as $1.08 in 1916.

To get the total inflation rate for the 1 years between 1915 and 1916, we use the following formula:

CPI in 1916 - CPI in 1915CPI in 1915
×
100
=
Cumulative inflation rate (1 years)

Plugging in the values to this equation, we get:

10.9 - 10.110.1
×
100
=
8%

Comparison to S&P 500 Index

To help put this inflation into perspective, if we had invested $1 in the S&P 500 index in 1915, our investment would be nominally worth approximately $1.42 in 1916. This is a return on investment of 41.84%, with an absolute return of $0.42.

These numbers are not inflation adjusted, so they are considered nominal. In order to evaluate the real return on our investment, we must calculate the return with inflation taken into account.

The compounding effect of inflation would account for 7.34% of returns ($0.03) during this period. This means the inflation-adjusted real return of our $1 investment is $0.39.

Investment in S&P 500 Index, 1915-1916
Original Amount Final Amount Change
Nominal $1 $1.42 41.84%
Real
Inflation Adjusted
$1 $0.39 38.77%


News headlines from 1915

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

  • French troops force Germans back into the Champagne region, suffering losses of 50,000 men and gaining several hundred yards.
  • Germany uses poison gas for the first time in World War I.
  • Almost 430,000 French, British, and Germans are killed in the Battle of Loos.
  • The one-millionth Model T is produced by Ford Motor Company.

Data Source & Citation

Raw data for these calculations comes from the Bureau of Labor Statistics' (CPI), established in 1913. Inflation data from 1665 to 1912 is sourced from a historical study conducted by political science professor Robert Sahr at Oregon State University.

You may use the following MLA citation for this page: “Inflation Rate in 1916 | Inflation Calculator.” U.S. Official Inflation Data, Alioth Finance, 14 Nov. 2018, https://www.officialdata.org/inflation-rate-in-1916.

in2013dollars.com is a reference website maintained by the Official Data Foundation.


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