The highest inflation in U.S. history: year-by-year records

People usually ask me this question in its post-1950 form — what is the highest inflation rate in the U.S. since 1950? The answer is 1980, at 13.5%, when the CPI-U jumped from 72.6 to 82.4 in a single year. But the full record book goes further back, and it is more dramatic: the all-time peak in the BLS series is 1918, at 18.0%, and the worst deflation year is 1921, when prices fell 10.5%. Every figure on this page is recomputed from the same BLS CPI-U annual-average series, 1913–2025, that powers our inflation calculator — so you can audit each rate yourself: it is always the year’s CPI divided by the prior year’s CPI, minus one.

The record table: the twelve highest-inflation years

Annual-average CPI-U inflation rates, recomputed from the BLS CPI-U series, 1913–2025. The 2022 rate of 8.0% — the worst year of the recent surge — ranks just outside this table, 13th. Read the 1980 row as the answer to the modern question: it is the highest inflation rate in U.S. since 1950.

The four great waves

1917–1920: the war spike

The three highest years on record all sit inside one episode. Financing a world war while factories converted to military production pushed prices up 83.5% in just four years — $100 of 1916 spending cost $183.49 by 1920. Then the bill arrived: 1921 brought the sharpest deflation in the series (see below), a brutal one-year correction that is still the record in the other direction.

1946–1948: the controls come off

During the Second World War, price controls suppressed the official index even as money chased scarce goods. When controls lapsed, the suppressed pressure released at once: 8.3% in 1946, a post-1950-class 14.4% in 1947, and 8.1% in 1948 — a cumulative 33.9% rise in three years. A $100 basket in 1945 cost $133.89 by 1948.

1973–1981: the Great Inflation

The episode that still shapes American economic memory. Two oil shocks (1974: 11.0%; 1979–80: 11.3% and 13.5%), loose monetary policy and entrenched expectations stacked years on years: prices rose 39.4% between 1978 and 1981 alone, so $100 of 1978 spending needed $139.42 three years later. It ended only when Federal Reserve chair Paul Volcker drove interest rates to punishing levels and accepted two recessions as the price of breaking expectations.

2021–2022: the pandemic surge

Supply chains jammed, stimulus met closed factories, then energy spiked. The annual-average rate hit 4.7% in 2021 and 8.0% in 2022 — the highest since 1981, and genuinely painful, but perspective matters: 8.0% is less than half the 1918 record and well below the 1980 post-1950 peak of 13.5%. It also faded far faster, easing to 4.1% in 2023, 2.9% in 2024 and 2.5% in 2025 on the annual-average basis.

The other record book: deflation years

Prices can fall, too — 13 years in the series are negative. These are the deepest:

Negative annual-average CPI-U years, recomputed from the same BLS series. Falling prices sound pleasant; in the 1930s they crushed debtors, whose loans stayed fixed while incomes and prices fell — a key reason central banks now fear deflation more than mild inflation.

Reading the records like an economist

Three patterns jump out of the full 113-year series, and I keep all three in mind when I plan my own money. First, extreme inflation is a wartime and supply-shock phenomenon — every year above 10% sits next to a war or an oil shock. Second, the damage compounds quietly: no single year of the Great Inflation matched 1918, yet nine straight years above 4% (1973–1981) raised the price level far more than the one-year 1918 spike did. Third, the modern era is calmer but not immune: from 1992 to 2020 the rate never once reached 4% on an annual-average basis — then 2022 printed 8.0%. Across the whole series the index rose from 9.9 to 321.5, a cumulative 3,147%, or about 3.2% a year — the long-run headwind every saver and retiree is really planning against.

How these records were computed — and one honest caveat

Every rate here uses the same recipe: the year’s CPI-U annual average divided by the prior year’s, minus one. I use annual averages deliberately, because they are the basis of the calculator on this site and they smooth out single-month spikes. Measured month by month instead, the peaks look slightly different — individual months in 1980 ran hotter than its 13.5% annual figure, and mid-2022 ran hotter than its 8.0% — but the ordering of the records does not change: 1918 still owns the crown, 1980 still owns the modern era, and 1921 still owns deflation. The disinflation that followed the peak deserves a footnote of its own: 1982 still printed 6.2%, and 1990 flared briefly to 5.4% around the Gulf War oil spike, before the long calm of 1992–2020, when the highest annual reading of all — 2008’s 3.9% — would have looked like relief in any earlier era.

Sources: all rates and index values computed from the U.S. Bureau of Labor Statistics CPI-U annual-average series, 1913–2025 (rate = CPI of the year ÷ CPI of the prior year − 1) — the same series used by the CalcFolk inflation calculator. Historical context (oil shocks, Volcker tightening, wartime controls) is standard Federal Reserve and BLS historical record.