Inflation is a regular part of any economy, but the rate of inflation can vary widely from year to year. In the United States, the average annual inflation rate in the past eighty years has been approximately three percent.

The annual rate of inflation in the United States since 1940 offers insight into how prices have changed over time. The average national inflation rate for the 80-year period was 3.02 percent. In the 1940s, the average rate of inflation was 4.12 percent. The 1950s saw a slight decrease to 3.64 percent. The average rate of inflation for the 1960s was 4.62 percent, while the 1970s registered an average rate of 6.77 percent. The 1980s dropped back down to an average rate of 4.12 percent and the 1990s were slightly higher, at 3.25 percent. The rate of inflation in the 2000s was even lower, at 2.56 percent, and the 2010s registered an average rate of 2.03 percent.

Inflation is an important economic indicator, which is why tracking the rate of inflation is a key part of the Federal Reserve’s role of responsibly managing the economy and ensuring economic stability. While the average rate has remained around 3 percent in the long-term, short-term increases or decreases can occur as a result of various economic factors.

Inflation is a fundamental factor that affects our day-to-day lives. Knowing the long-term average rate of inflation can help us better understand the impact it has on our purchasing decisions and how it can impact our financial planning for the future.