$1 in 2007 is equivalent in purchasing power to about $1.04 in 2008. The dollar had an average inflation rate of 3.84% per year between 2007 and 2008, producing a cumulative price increase of 3.84%. Purchasing power decreased by 3.84% in 2008 compared to 2007. On average, you would have to spend 3.84% more money in 2008 than in 2007 for the same item.
This means that prices in 2008 are 1.04 times as high as average prices since 2007, according to the Bureau of Labor Statistics consumer price index.
The inflation rate in 2007 was 2.85%. The inflation rate in 2008 was 3.84%. The 2008 inflation rate is higher compared to the average inflation rate of 2.42% per year between 2008 and 2024.
Inflation rate is calculated by change in the consumer price index (CPI). The CPI in 2008 was 215.30. It was 207.34 in the previous year, 2007. The difference in CPI between the years is used by the Bureau of Labor Statistics to officially determine inflation.
Average inflation rate | 3.84% |
Converted amount $1 base | $1.04 |
Price difference $1 base | $0.04 |
CPI in 2007 | 207.342 |
CPI in 2008 | 215.303 |
Inflation in 2007 | 2.85% |
Inflation in 2008 | 3.84% |
$1 in 2007 | $1.04 in 2008 |
Inflation can vary widely by city, even within the United States. Here's how some cities fared in 2007 to 2008 (figures shown are purchasing power equivalents of $1):
Miami-Fort Lauderdale, Florida experienced the highest rate of inflation during the 1 years between 2007 and 2008 (4.81%).
Detroit, Michigan experienced the lowest rate of inflation during the 1 years between 2007 and 2008 (2.44%).
Note that some locations showing 0% inflation may have not yet reported latest data.
Inflation can also vary widely by country. For comparison, in the UK £1.00 in 2007 would be equivalent to £1.04 in 2008, an absolute change of £0.04 and a cumulative change of 3.99%.
In Canada, CA$1.00 in 2007 would be equivalent to CA$1.02 in 2008, an absolute change of CA$0.02 and a cumulative change of 2.37%.
Compare these numbers to the US's overall absolute change of $0.04 and total percent change of 3.84%.
CPI is the weighted combination of many categories of spending that are tracked by the government. Breaking down these categories helps explain the main drivers behind price changes.
Between 2007 and 2008:
This chart shows the average rate of inflation for select CPI categories between 2007 and 2008.
Compare these values to the overall average of 3.84% per year:
Category | Avg Inflation (%) | Total Inflation (%) | $1 in 2007 → 2008 |
---|---|---|---|
Food and beverages | 5.37 | 5.37 | 1.05 |
Housing | 3.19 | 3.19 | 1.03 |
Apparel | -0.08 | -0.08 | 1.00 |
Transportation | 5.88 | 5.88 | 1.06 |
Medical care | 3.71 | 3.71 | 1.04 |
Recreation | 1.62 | 1.62 | 1.02 |
Education and communication | 3.39 | 3.39 | 1.03 |
Other goods and services | 3.62 | 3.62 | 1.04 |
For all these visualizations, it's important to note that not all categories may have been tracked since 2007. This table and charts use the earliest available data for each category.
Our calculations use the following inflation rate formula to calculate the change in value between 2007 and 2008:
Then plug in historical CPI values. The U.S. CPI was 207.342 in the year 2007 and 215.303 in 2008:
$1 in 2007 has the same "purchasing power" or "buying power" as $1.04 in 2008.
To get the total inflation rate for the 1 years between 2007 and 2008, we use the following formula:
Plugging in the values to this equation, we get:
There are multiple ways to measure inflation. Published rates of inflation will vary depending on methodology. The Consumer Price Index, used above, is the most common standard used globally.
Alternative measurements are sometimes used based on context and economic/political circumstances. Below are a few examples of alternative measurements.
The PCE Price Index is the U.S. Federal Reserve's preferred measure of inflation, compiled by the Bureau of Economic Analysis. It measures the change in prices of goods and services purchased by consumers.
The PCE Price Index changed by 2.96% per year on average between 2007 and 2008. The total PCE inflation between these dates was 2.96%. In 2007, PCE inflation was 2.57%.
This means that the PCE Index equates $1 in 2007 with $1.03 in 2008, a difference of $0.03. Compare this to the standard CPI measurement, which equates $1 with $1.04. The PCE measured -0.88% inflation compared to standard CPI.
For more information on the difference between PCE and CPI, see this analysis provided by the Bureau of Labor Statistics.
Also of note is the Core CPI, which uses the standard CPI but omits the more volatile categories of food and energy.
Core inflation averaged 2.30% per year between 2007 and 2008 (vs all-CPI inflation of 3.84%), for an inflation total of 2.30%. In 2007, core inflation was 2.34%.
When using the core inflation measurement, $1 in 2007 is equivalent in buying power to $1.02 in 2008, a difference of $0.02. Recall that the converted amount is $1.04 when all items including food and energy are measured.
Chained CPI is an alternative measurement that takes into account how consumers adjust spending for similar items. Chained inflation averaged 3.73% per year between 2007 and 2008, a total inflation amount of 3.73%.
According to the Chained CPI measurement, $1 in 2007 is equal in buying power to $1.04 in 2008, a difference of $0.04 (versus a converted amount of $1.04/change of $0.04 for All Items).
In 2007, chained inflation was 2.53%.
To help put this inflation into perspective, if we had invested $1 in the S&P 500 index in 2007, our investment would be nominally worth approximately $0.63 in 2008. This is a return on investment of -36.56%, with an absolute return of $-0.37 on top of the original $1.
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 3.70% of returns ($0.02) during this period. This means the inflation-adjusted real return of our $1 investment is $-0.39. You may also want to account for capital gains tax, which would take your real return down to around $0 for most people.
Original Amount | Final Amount | Change | |
---|---|---|---|
Nominal | $1 | $0.63 | -36.56% |
Real Inflation Adjusted | $1 | $0.61 | -38.90% |
Information displayed above may differ slightly from other S&P 500 calculators. Minor discrepancies can occur because we use the latest CPI data for inflation, annualized inflation numbers for previous years, and we compute S&P price and dividends from January of 2007 to latest available data for 2008 using average monthly close price.
For more details on the S&P 500 between 2007 and 2008, see the stock market returns calculator.
Raw data for these calculations comes from the Bureau of Labor Statistics' Consumer Price Index (CPI), established in 1913. Price index data from 1774 to 1912 is sourced from a historical study conducted by political science professor Robert Sahr at Oregon State University and from the American Antiquarian Society. Price index data from 1634 to 1773 is from the American Antiquarian Society, using British pound equivalents.
You may use the following MLA citation for this page: “Inflation Rate in 2008 | Inflation Calculator.” Official Inflation Data, Alioth Finance, 1 Dec. 2024, https://www.officialdata.org/inflation-rate-in-2008.
Special thanks to QuickChart for their chart image API, which is used for chart downloads.
in2013dollars.com is a reference website maintained by the Official Data Foundation.
Average inflation rate | 3.84% |
Converted amount $1 base | $1.04 |
Price difference $1 base | $0.04 |
CPI in 2007 | 207.342 |
CPI in 2008 | 215.303 |
Inflation in 2007 | 2.85% |
Inflation in 2008 | 3.84% |
$1 in 2007 | $1.04 in 2008 |