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# U.K. inflation rate in 1998: 3.43%

### Inflation in 1998 and Its Effect on Pound Value

Purchasing power decreased by 3.43% in 1998 compared to 1997. On average, you would have to spend 3.43% more money in 1998 than in 1997 for the same item.

In other words, £1 in 1997 is equivalent in purchasing power to about £1.03 in 1998.

The 1997 inflation rate was 3.14%. The inflation rate in 1998 was 3.43%. The 1998 inflation rate is higher compared to the average inflation rate of 2.63% per year between 1998 and 2020.

Inflation rate is calculated by change in the composite price index (CPI). The CPI in 1998 was 642.60. It was 621.30 in the previous year, 1997. The difference in CPI between the years is used by the Office for National Statistics to officially determine inflation.

 Average inflation rate 3.43% Converted amount (£1 base) £1.03 Price difference (£1 base) £0.03 CPI in 1997 621.300 CPI in 1998 642.600 Inflation in 1997 3.14% Inflation in 1998 3.43%

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

### How to Calculate Inflation Rate for £1, 1997 to 1998

This inflation calculator uses the following inflation rate formula:

CPI in 1998CPI in 1997
×
1997 GBP value
=
1998 GBP value

Then plug in historical CPI values. The U.K. CPI was 621.3 in the year 1997 and 642.6 in 1998:

642.6621.3
×
£1
=
£1.03

£1 in 1997 has the same "purchasing power" or "buying power" as £1.03 in 1998.

To get the total inflation rate for the 1 years between 1997 and 1998, we use the following formula:

CPI in 1998 - CPI in 1997CPI in 1997
×
100
=
Cumulative inflation rate (1 years)

Plugging in the values to this equation, we get:

642.6 - 621.3621.3
×
100
=
3%

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

• Production, stockpiling and use of chemical weapons is outlawed as the Chemical Weapons Convention of 1993 comes into force.
• The British lease of the New Territories in Hong Kong expires.
• Diana, Princess of Wales, dies in a car crash in Paris.
• Hong Kong begins slaughtering chickens to prevent bird flu.

### 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 1998 | UK Inflation Calculator.” Official Inflation Data, Alioth Finance, 23 Jan. 2020, https://www.officialdata.org/UK-inflation-rate-in-1998.