US inflation over time
Inflation is how fast prices are rising — the percentage by which the cost of a typical basket of goods and services is higher than a year earlier. The line below tracks the US Consumer Price Index (CPI-U) for each year since 1960. Hover or tap to read off any year; the dashed line marks the Federal Reserve’s informal 2% goal for inflation.
The long view splits neatly in two: the turbulent Great Inflation of the 1965–1982 era, when prices sometimes rose more than 10% a year, and the long calm that followed once the Federal Reserve crushed inflation in the early 1980s. That calm held for four decades — until the post-pandemic spike of 2021–22 brought the highest inflation since 1981.
US annual CPI-U inflation (%). The dashed line is the Federal Reserve’s 2% goal. Figures rounded to annual averages — see sources.
What the chart shows
- The Great Inflation (1965–82). Loose policy, the end of the gold-backed dollar and two oil shocks — the 1973 OPEC embargo and the 1979 Iranian revolution — pushed inflation into double digits.
- The Volcker squeeze. Fed chair Paul Volcker raised interest rates close to 20% around 1980–81, triggering a sharp recession but breaking inflation’s back by 1983.
- The Great Moderation. From the mid-1980s, inflation stayed low and steady — mostly between 1% and 4% — for a generation.
- Briefly negative in 2009. The financial crisis and a collapse in oil prices produced a rare year of falling prices (deflation).
- The 2021–22 spike. Reopening demand, pandemic stimulus and snarled supply chains — then the energy shock from Russia’s invasion of Ukraine — drove CPI to a peak of 9.1% in June 2022, a 40-year high. The Fed responded with its fastest rate hikes since the 1980s.
How it’s measured
The Bureau of Labor Statistics prices a basket of goods and services each month and reports how much it has changed over the previous twelve months. The figures here are annual averages of that rate. The headline CPI-U covers all urban consumers; policymakers also watch “core” inflation (stripping out volatile food and energy) and the Fed’s preferred PCE measure, which usually runs a little lower than CPI.