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# U.S. inflation rate in 1956: 1.49%

### Inflation in 1956 and Its Effect on Dollar Value

Purchasing power decreased by 1.49% in 1956 compared to 1955. On average, you would have to spend 1.49% more money in 1956 than in 1955 for the same item.

In other words, \$1 in 1955 is equivalent in purchasing power to about \$1.01 in 1956.

The 1955 inflation rate was -0.37%. The inflation rate in 1956 was 1.49%. The 1956 inflation rate is lower compared to the average inflation rate of 3.63% per year between 1956 and 2019.

Inflation rate is calculated by change in the consumer price index (CPI). The CPI in 1956 was 27.20. It was 26.80 in the previous year, 1955. The difference in CPI between the years is used by the Bureau of Labor Statistics to officially determine inflation.

 Average inflation rate 1.49% Converted amount (\$1 base) \$1.01 Price difference (\$1 base) \$0.01 CPI in 1955 26.800 CPI in 1956 27.200 Inflation in 1955 -0.37% Inflation in 1956 1.49%

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 1955 to 1956 (figures shown are purchasing power equivalents of \$1):

Boston, Massachusetts experienced the highest rate of inflation during the 1 years between 1955 and 1956 (2.75%).

Seattle, Washington experienced the lowest rate of inflation during the 1 years between 1955 and 1956 (1.09%).

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 1955 would be equivalent to £1.05 in 1956, an absolute change of £0.05 and a cumulative change of 5.10%.

In Canada, CA\$1.00 in 1955 would be equivalent to CA\$1.03 in 1956, an absolute change of CA\$0.03 and a cumulative change of 2.82%.

Compare these numbers to the US's overall absolute change of \$0.01 and total percent change of 1.49%.

### 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 1955 and 1956.

Compare these values to the overall average of 1.49% per year:

Category Avg Inflation (%) Total Inflation (%) \$1 in 1955 → 1956
Food 0.75 0.75 1.01
Shelter 1.66 1.66 1.02
Energy 0.00 0.00 1.00
Apparel 2.01 2.01 1.02
New vehicles 0.00 0.00 1.00
Used cars and trucks 0.00 0.00 1.00
Transportation services 1.50 1.50 1.02
Medical care services 3.52 3.52 1.04
Medical care commodities 2.16 2.16 1.02

It's important to note that not all categories may be tracked since 1955. This table and visualization use the earliest available data for each category.

### How to Calculate Inflation Rate for \$1, 1955 to 1956

This inflation calculator uses the following inflation rate formula:

CPI in 1956CPI in 1955
×
1955 USD value
=
1956 USD value

Then plug in historical CPI values. The U.S. CPI was 26.8 in the year 1955 and 27.2 in 1956:

27.226.8
×
\$1
=
\$1.01

\$1 in 1955 has the same "purchasing power" or "buying power" as \$1.01 in 1956.

To get the total inflation rate for the 1 years between 1955 and 1956, we use the following formula:

CPI in 1956 - CPI in 1955CPI in 1955
×
100
=
Cumulative inflation rate (1 years)

Plugging in the values to this equation, we get:

27.2 - 26.826.8
×
100
=
1%

### 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 1955, our investment would be nominally worth approximately \$1.38 in 1956. This is a return on investment of 37.76%, with an absolute return of \$0.38.

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 1.47% of returns (\$0.01) during this period. This means the inflation-adjusted real return of our \$1 investment is \$0.37.

Investment in S&P 500 Index, 1955-1956
Original Amount Final Amount Change
Nominal \$1 \$1.38 37.76%
Real
\$1 \$0.37 37.20%

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

• The occupying powers grant full Sovereignty to West Germany.
• The Mainau Declaration against nuclear weapons is signed by 18 Nobel laureates.
• Rosa Parks is arrested in Montgomery, Alabama for refusing to give her seat to a white person and move to the back of the bus.

### 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 1956 | Inflation Calculator.” U.S. Official Inflation Data, Alioth Finance, 24 Oct. 2019, https://www.officialdata.org/inflation-rate-in-1956.