Inflation Calculator
Work out what an old amount of money is worth now, or what today's money will buy in the future, using real Australian CPI data.
Your details
Real ABS CPI data, 1948 to 2025. 2025 is the last complete calendar year, so it is the most recent comparison available.
$100 in 1990 is worth
$248in 2025
Total inflation
148.3%
Average a year
2.63%
Over
35 years
A 2025 dollar buys what $0.40 bought in 1990
Which is the same fact from the other direction. Prices rose 148% over those 35 years, so anything that did not rise with them, a wage, a savings balance, a threshold left unindexed, quietly shrank by the same amount.
Historical figures use annual average ABS Consumer Price Index data, all groups, weighted average of the eight capital cities. Forward figures compound the rate you choose, which is a scenario rather than a forecast, because nobody knows what inflation does next.
How to use this calculator
- 1. Past money uses real CPI data between two years. Future money compounds a rate you choose, because nobody knows what inflation actually does next.
- 2. A wage from your first job, the price of a house, what a pie cost. Anything between 1948 and 2025, which is the last complete calendar year in the data.
- 3. 2.5% is the middle of the RBA target band and a fair long-run default. Try 3.5% for something closer to recent experience, and 5% as a stress test.
- 4. Enter what your cash is actually earning. If the number comes back negative, your balance is still growing but it buys less each year.
How Australia actually measures inflation
The ABS tracks the price of a basket of goods and services a typical household buys, across eleven groups: food and non-alcoholic drinks, alcohol and tobacco, clothing and footwear, housing, furnishings and household equipment, health, transport, communication, recreation and culture, education, and insurance and financial services. Each group is weighted by how much of a household budget it represents, and housing is by far the biggest slice.
In the twelve months to July 2026, headline CPI inflation was 3.5%, down from 3.8% in June. The trimmed mean, which strips out the most extreme 15% of price moves at each end to show the underlying trend, sat at 3.6%. Housing was the largest contributor at 5.0%, then food at 3.2%. The ABS reweights the basket periodically, so the CPI formula today is not identical to the one used in 1990, which is worth remembering on very long comparisons.
Your personal inflation rate is not the headline number
The headline figure is an average across every household in the country, and averages hide a lot. If you rent, housing hits you differently than it hits someone who paid off a mortgage a decade ago. If you drive for work, fuel moves your budget far more than the weighting suggests. Retirees spend a bigger share on health, which has its own trajectory.
The ABS does publish Living Cost Indexes for four household types, including employee households and age pensioner households, which track cost pressures more precisely for each group. But the headline CPI is what the RBA targets and what flows through to wage cases, rent reviews and benefit indexation, so it is the number that shapes your life even when it does not describe it.
Why a high interest savings account can still lose money
Here is the arithmetic the ads skip. Say your account pays 5% and inflation is 3.5%. That looks like 1.5% ahead, and before tax it roughly is. But interest is taxable at your marginal rate, and in the $45,001 to $135,000 bracket that is 30% plus the 2% Medicare levy, so 32%. Your 5% becomes 3.4% after tax, against 3.5% inflation, and you are very slightly going backwards.
The balance still rises every month, which is exactly why this is so easy to miss. The fix is not to panic out of cash, an emergency fund belongs in cash regardless of the real return, it is to be clear about which job each pot of money is doing. Money you need within a couple of years belongs somewhere safe even if it loses a little. Money you will not touch for a decade has better options, which our compound interest calculator can model.
The pay rise you need just to stand still
If inflation is 3.5%, a 3.5% pay rise leaves you exactly where you were. Anything below that is a pay cut, however positive the conversation felt. On $80,000 you need $2,800 more just to break even, so a "generous" 2% offer worth $1,600 is a real cut of around $1,200 in purchasing power.
This is worth having in your head before a salary conversation, not after. The Fair Work Commission explicitly weighs CPI in the annual minimum wage review, so the principle is baked into how wages are set at the bottom of the market. Real wage growth, the kind that actually changes your life, only starts above the inflation line.
Inflation quietly helps if you have a mortgage
A mortgage is a fixed nominal debt, and inflation eats fixed nominal debts. Borrow $600,000 and let 3% inflation run for a decade and that debt, in real terms, is worth substantially less than what you borrowed, while wages generally drift up with prices. The repayment becomes a smaller share of your pay without you doing anything.
The catch is timing. The RBA fights inflation by lifting the cash rate, so on a variable loan you pay for that long-run erosion with higher repayments right now. You get the benefit slowly and the pain immediately, which is why it never feels like a gift. Our mortgage repayment calculator shows what a rate move does to the monthly figure.
Why the RBA targets 2 to 3% rather than zero
Zero inflation sounds ideal and is actually dangerous, because it sits next door to deflation. When prices fall, people delay buying, businesses stop investing, and the whole thing can spiral. Japan spent decades trying to climb out of exactly that hole.
Mild inflation also leaves the RBA somewhere to go. If both rates and inflation are already near zero, there is nothing left to cut when a recession arrives. The 2 to 3% band is the compromise: enough to keep money moving and to give monetary policy room, not so much that you watch your savings erode. Above the band the RBA lifts rates, below it they cut, which is the whole mechanism in one sentence. Our explainer on what inflation actually is goes deeper on the causes.
FAQ
What data does the historical mode use?
Annual average Consumer Price Index figures from the ABS, all groups, weighted average of the eight capital cities, covering 1948 to 2025. We cross-checked the series against ABS quarterly CPI on the 2011-12 base and the year-on-year ratios match, so the numbers line up with the official index rather than approximating it.
Why does the data stop at 2025?
Because 2025 is the last complete calendar year. Averaging a part-year would quietly distort every comparison made against it, and a calculator that looks precise while being subtly wrong is worse than one that admits its limits. Use the forward mode if you want to project past the end of the series.
What is Australia's inflation rate right now?
CPI inflation was 3.5% in the twelve months to July 2026, down from 3.8% to June. The trimmed mean, the RBA's preferred underlying measure, was 3.6%. Both come from the ABS monthly indicator and move with each release, so check abs.gov.au for the current figure.
What inflation rate should I use for future projections?
The RBA target midpoint of 2.5% is a sensible long-run default. Use 3% to 3.5% for something closer to recent experience, and run 4% to 5% as a stress test. Do not anchor on one number, the point of the forward mode is to see how much the answer moves when the assumption does.
What is trimmed mean inflation?
It removes the most extreme 15% of price movements at each end before averaging what is left. That filters out one-off shocks like a fuel spike or a government rebate unwinding, and shows the underlying trend. The RBA watches it closely because monetary policy cannot do much about a one-off, but it can about persistent pressure.
What was $100 in 1990 worth today?
About $248 in 2025 money, which works out to roughly 2.63% inflation a year over those 35 years. Put your own year and amount into the calculator for anything from 1948 onwards, the answer comes straight from the CPI series rather than an assumed rate.
Is CPI the same as the cost of living?
Not quite. CPI tracks the price of a fixed basket, while cost of living also reflects changing quality, new products and shifts in what people actually buy. The ABS publishes separate Living Cost Indexes for specific household types that get closer to lived experience, but CPI remains the benchmark everything else is indexed to.
How does inflation affect my super?
Twice over. Your fund's reported return is nominal, so an 8% year with 3.5% inflation is really about 4.3% in purchasing power. And the balance itself matters less than what it buys, since $1 million in thirty years will not go as far as $1 million now. Our superannuation calculator has a today's dollars toggle for exactly this reason.
Does inflation help or hurt someone with a mortgage?
Long term it helps, because it erodes the real value of a fixed debt while incomes tend to drift up with prices. Short term it hurts, because the RBA raises rates to fight inflation and your variable repayment goes up immediately. Fixed-rate borrowers get the benefit without the immediate pain, at least until the fixed term ends.
How does the RBA actually control inflation?
Mostly through the cash rate. Raising it makes borrowing more expensive across mortgages, business loans and credit, which cools spending and eventually prices. The effect is slow, typically 12 to 18 months to flow through fully, which is why the RBA is often accused of acting too late in both directions.
Why did inflation spike in 2022 and 2023?
A combination of pandemic supply chain disruption, an energy shock following the invasion of Ukraine, and strong domestic demand supported by stimulus. Supply and demand pressure at the same time is the worst case, because the usual tool, raising rates, only really works on the demand half.
Is some inflation actually a good thing?
Within the 2 to 3% band, yes. It keeps money circulating rather than sitting idle, gradually reduces the real weight of debt, and leaves the RBA with rate cuts available when a downturn comes. It becomes a problem when it runs persistently above target and eats real wages, or when it gets unpredictable enough that nobody can plan.
Related reading
What Is Inflation? A Plain-English Guide for Australians
What is inflation, how is it measured in Australia, and what does it mean for your savings and investments? A plain-English explainer with real numbers.
Do You Pay Tax on Savings Account Interest in Australia?
Yes, savings account interest is taxable in Australia at your marginal rate. Here is how it works, how to declare it, the TFN trap, and how an offset can beat it.
Best High-Interest Savings Accounts in Australia (2026)
Not all high-interest savings accounts are created equal. This guide cuts through the headline rates to help you find the right account for your actual savings goal.
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Disclaimer
Historical figures use annual average Consumer Price Index data published by the Australian Bureau of Statistics, all groups, weighted average of the eight capital cities, rebased so 2025 equals 100. The series covers 1948 to 2025, and years outside that range are clamped to the nearest year with real data rather than extrapolated. ABS data is subject to revision, and the CPI basket and its weightings have changed over time, so very long comparisons are indicative rather than exact. Forward projections compound whatever rate you enter and are scenarios, not forecasts. Real return figures are illustrative and use the Fisher relation rather than simple subtraction, and they ignore tax on interest unless you account for it yourself. This tool provides estimates only and is not financial advice. Current CPI figures are at abs.gov.au.