# U.K. inflation rate in 1926: -0.54%

£

## Inflation in 1926 and its effect on pound value

Purchasing power increased by 0.54% in 1926 compared to 1925. On average, you would have to spend 0.54% less money in 1926 than in 1925 for the same item. This is an example of deflation.

In other words, £1 in 1925 is equivalent in purchasing power to about £0.99 in 1926.

The 1925 inflation rate was 0.00%. The inflation rate in 1926 was -0.54%. The 1926 inflation rate is lower compared to the average inflation rate of 4.48% per year between 1926 and 2020.

Inflation rate is calculated by change in the composite price index (CPI). The CPI in 1926 was 18.50. It was 18.60 in the previous year, 1925. The difference in CPI between the years is used by the Office for National Statistics to officially determine inflation. Because the 1926 CPI is less than 1925 CPI, negative inflation (also known as deflation) has occurred.

 Average inflation rate -0.54% Converted amount (£1 base) £0.99 Price difference (£1 base) £-0.01 CPI in 1925 18.600 CPI in 1926 18.500 Inflation in 1925 0.00% Inflation in 1926 -0.54%

GBP Inflation since 1750
Annual Rate, the Office for National Statistics CPI

## How to Calculate Inflation Rate for £1, 1925 to 1926

Our calculations use the following inflation rate formula to calculate the change in value between 1925 and 1926:

CPI in 1926 CPI in 1925
×
1925 GBP value
=
1926 GBP value

Then plug in historical CPI values. The U.K. CPI was 18.6 in the year 1925 and 18.5 in 1926:

18.518.6
×
£1
=
£0.99

£1 in 1925 has the same "purchasing power" or "buying power" as £0.99 in 1926.

To get the total inflation rate for the 1 years between 1925 and 1926, we use the following formula:

CPI in 1926 - CPI in 1925CPI in 1925
×
100
=
Cumulative inflation rate (1 years)

Plugging in the values to this equation, we get:

18.5 - 18.618.6
×
100
=
-1%

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

• The Ku Klux Klan's first national march takes place in Washington.
• The last Qajar Shah of Iran is deposed with Reza Shah Pahlavi taking over.
• Scopes monkey trial ends in Dayton, Tennessee, finding John T. Scopes guilty of teaching evolution.

## Data Source & Citation

Raw data for these calculations comes from the composite price index published by the UK Office for National Statistics (ONS). A composite index is created by combining price data from several different published sources, both official and unofficial. The Consumer Price Index, normally used to compute inflation, has only been tracked since 1988. All inflation calculations after 1988 use the Office for National Statistics' Consumer Price Index, except for 2017, which is based on The Bank of England's forecast.

You may use the following MLA citation for this page: “Inflation Rate in 1926 | UK Inflation Calculator.” Official Inflation Data, Alioth Finance, 3 Jun. 2020, https://www.officialdata.org/UK-inflation-rate-in-1926.