U.S. inflation rate in 1938: -2.08%

Inflation Calculator


Inflation in 1938 and Its Effect on Dollar Value

Purchasing power increased by 2.08% in 1938 compared to 1937. On average, you would have to spend 2.08% less money in 1938 than in 1937 for the same item. This is an example of deflation.

In other words, $1 in 1937 is equivalent in purchasing power to about $0.98 in 1938.

The 1937 inflation rate was 3.60%. The inflation rate in 1938 was -2.08%. The 1938 inflation rate is lower compared to the average inflation rate of 3.63% per year between 1938 and 2019.

Inflation rate is calculated by change in the consumer price index (CPI). The CPI in 1938 was 14.10. It was 14.40 in the previous year, 1937. The difference in CPI between the years is used by the Bureau of Labor Statistics to officially determine inflation. Because the 1938 CPI is less than 1937 CPI, negative inflation (also known as deflation) has occurred.

Inflation from 1937 to 1938
Average inflation rate -2.08%
Converted amount ($1 base) $0.98
Price difference ($1 base) $-0.02
CPI in 1937 14.400
CPI in 1938 14.100
Inflation in 1937 3.60%
Inflation in 1938 -2.08%

USD 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 1937 to 1938 (figures shown are purchasing power equivalents of $1):

San Francisco, California experienced the highest rate of inflation during the 1 years between 1937 and 1938 (0.46%).

Boston, Massachusetts experienced the lowest rate of inflation during the 1 years between 1937 and 1938 (-2.55%).

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 1937 would be equivalent to £1.01 in 1938, an absolute change of £0.01 and a cumulative change of 1.20%.

In Canada, CA$1.00 in 1937 would be equivalent to CA$0.97 in 1938, an absolute change of CA$-0.03 and a cumulative change of -2.56%.

Compare these numbers to the US's overall absolute change of $-0.02 and total percent change of -2.08%.

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 1937 and 1938.

Compare these values to the overall average of -2.08% per year:

Category Avg Inflation (%) Total Inflation (%) $1 in 1937 → 1938
Food -7.23 -7.23 0.93
Shelter 0.00 0.00 1.00
Energy 0.00 0.00 1.00
Apparel -1.26 -1.26 0.99
New vehicles 0.00 0.00 1.00
Used cars and trucks 0.00 0.00 1.00
Transportation services 0.68 0.68 1.01
Medical care services 0.00 0.00 1.00
Medical care commodities 0.63 0.63 1.01

It's important to note that not all categories may be tracked since 1937. This table and visualization use the earliest available data for each category.

How to Calculate Inflation Rate for $1, 1937 to 1938

This inflation calculator uses the following inflation rate formula:

CPI in 1938CPI in 1937
1937 USD value
1938 USD value

Then plug in historical CPI values. The U.S. CPI was 14.4 in the year 1937 and 14.1 in 1938:


$1 in 1937 has the same "purchasing power" or "buying power" as $0.98 in 1938.

To get the total inflation rate for the 1 years between 1937 and 1938, we use the following formula:

CPI in 1938 - CPI in 1937CPI in 1937
Cumulative inflation rate (1 years)

Plugging in the values to this equation, we get:

14.1 - 14.414.4

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 1937, our investment would be nominally worth approximately $0.80 in 1938. This is a return on investment of -20.23%, with an absolute return of $-0.20.

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 -2.13% of returns ($0.00) during this period. This means the inflation-adjusted real return of our $1 investment is $-0.21.

Investment in S&P 500 Index, 1937-1938
Original Amount Final Amount Change
Nominal $1 $0.80 -20.23%
Inflation Adjusted
$1 $-0.21 -20.66%

News headlines from 1937

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

  • The Second Sino-Japanese War starts when Japanese and Chinese troops clash at the Marco Polo Bridge.
  • 193,000 Russians are executed by order of the Politburo's Operative Order 00447.
  • Adolf Hitler and his military leaders hold a secret meeting where he reveals his plan to go to war.

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 1938 | Inflation Calculator.” U.S. Official Inflation Data, Alioth Finance, 23 Apr. 2019, https://www.officialdata.org/inflation-rate-in-1938.

Special thanks to QuickChart for providing downloadable chart images.

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

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