U.S. inflation rate in 1785: -4.90%

Inflation Calculator

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Inflation in 1785 and Its Effect on Dollar Value

Purchasing power increased by 4.90% in 1785 compared to 1784. On average, you would have to spend 4.90% less money in 1785 than in 1784 for the same item. This is an example of deflation.

In other words, \$1 in 1784 is equivalent in purchasing power to about \$0.95 in 1785.

The 1784 inflation rate was -3.77%. The inflation rate in 1785 was -4.90%. The 1785 inflation rate is lower compared to the average inflation rate of 1.41% per year between 1785 and 2020.

Inflation rate is calculated by change in the consumer price index (CPI). The CPI in 1785 was 9.70. It was 10.20 in the previous year, 1784. The difference in CPI between the years is used by the Bureau of Labor Statistics to officially determine inflation. Because the 1785 CPI is less than 1784 CPI, negative inflation (also known as deflation) has occurred.

 Average inflation rate -4.90% Converted amount (\$1 base) \$0.95 Price difference (\$1 base) \$-0.05 CPI in 1784 10.200 CPI in 1785 9.700 Inflation in 1784 -3.77% Inflation in 1785 -4.90%

USD Inflation since 1635
Annual Rate, the Bureau of Labor Statistics CPI

Inflation by Country

Inflation can also vary widely by country. For comparison, in the UK £1.00 in 1784 would be equivalent to £0.95 in 1785, an absolute change of £-0.05 and a cumulative change of -5.26%.

Compare these numbers to the US's overall absolute change of \$-0.05 and total percent change of -4.90%.

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 1784 and 1785.

Compare these values to the overall average of -4.90% per year:

Category Avg Inflation (%) Total Inflation (%) \$1 in 1784 → 1785
Food and beverages 0.00 0.00 1.00
Housing 0.00 0.00 1.00
Apparel 0.00 0.00 1.00
Transportation 0.00 0.00 1.00
Medical care 0.00 0.00 1.00
Recreation 0.00 0.00 1.00
Education and communication 0.00 0.00 1.00
Other goods and services 0.00 0.00 1.00

For all these visualizations, it's important to note that not all categories may have been tracked since 1784. This table and charts use the earliest available data for each category.

How to Calculate Inflation Rate for \$1, 1784 to 1785

This inflation calculator uses the following inflation rate formula:

CPI in 1785CPI in 1784
×
1784 USD value
=
1785 USD value

Then plug in historical CPI values. The U.S. CPI was 10.2 in the year 1784 and 9.7 in 1785:

9.710.2
×
\$1
=
\$0.95

\$1 in 1784 has the same "purchasing power" or "buying power" as \$0.95 in 1785.

To get the total inflation rate for the 1 years between 1784 and 1785, we use the following formula:

CPI in 1785 - CPI in 1784CPI in 1784
×
100
=
Cumulative inflation rate (1 years)

Plugging in the values to this equation, we get:

9.7 - 10.210.2
×
100
=
-5%

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

• The Treaty of Paris, is formally ratified by the US Congress of the Confederation, ending US Revolutionary War
• Russia and Turkey sign an official treaty in Constantinople.
• The Emerald Buddha moves to Wat Phra Kaew, Thailand, which remained his residence for the rest of his life

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 1785 | Inflation Calculator.” Official Inflation Data, Alioth Finance, 9 Apr. 2020, https://www.officialdata.org/inflation-rate-in-1785.