CAD Inflation Calculator - Canadian Dollar (1971-2024)

$1,792 in 1971

$12,151.42 in 2021

The inflation rate in Canada between 1971 and 2021 was 578.09%, which translates into a total increase of $10,359.42. This means that 1,792 dollars in 1971 are equivalent to 12,151.42 dollars in 2021. In other words, the purchasing power of $1,792 in 1971 equals $12,151.42 in 2021. The average annual inflation rate between these periods was 3.9%.

Inflation timeline in Canada (1971 - 2021)

The following chart depicts the equivalence of $1,792 due to compound inflation and CPI changes. All values are equivalent in terms of purchasing power, which means that for each year the same goods or services could be bought with the indicated amount of money.

All calculations are performed in the local currency (CAD) and using 6 decimal digits. Results show only up to 2 decimal digits to favour readability. Inflation data is provided by governments and international institutions on a monthly basis.

The following table contains relevant indicators:

Indicator	Value
Cumulative inflation from 1971 to 2021	578.09%
Avg. Annual inflation from 1971 to 2021	3.9%
CPI 1971	16.5
CPI 2021	111.88

How to calculate the time value of money with inflation data?

There are several ways to calculate the time value of money. Depending on the data available, results can be obtained by using the Consumer Price Index (CPI) formula or the compound interest formula.

Using the CPI formula

When we have both the start and end years, we can use the following formula:

Value_t =Value₀ ×

CPI_t/CPI₀

To obtain the values equivalent in buying power between 1971 and 2021, use the corresponding CPI values:

Value₂₀₂₁

=Value₁₉₇₁ ×

CPI₂₀₂₁/CPI₁₉₇₁

=$ 1,792 ×

111.88/16.5

≈$12,151.42

Alternative: Using the compound interest formula

Given that money changes with time as a result of an inflation rate that acts as compound interest, we can use the following formula: FV = PV × (1 + i)ⁿ, where:

FV: Future Value
PV: Present Value
i: Interest rate (inflation)
n: Number of times the interest is compounded (i.e. # of years)

In this case, the future value represents the final amount obtained after applying the inflation rate to our initial value. In other words, it indicates how much are $1,792 worth today. There are 50 years between 1971 and 2021 and the average inflation rate was 3.9024%. Therefore, we can resolve the formula like this:

Value₂₀₂₁

=PV × (1 + i)ⁿ

=$1,792 × (1 + 0.039024)⁵⁰