They used the average CPI in that calculation-specifically CPI-U. There are lots of fun ways to calculate inflation, but that's probably one of the most seen. It's the one where they have a basket of goods to purchase, and they calculate the cost of those goods to urban consumers. It's also the basis of the inflation calculator on BLS.gov, which seems to match the results of the calculator in the link posted by Maibock with maybe a rounding issue. If anyone's bored enough to want to read about this stuff, you can look at the Bureau of Labor Statistics' CPI FAQ here
I checked out the Cleveland Fed's website, and they have a nifty tool that'll chart inflation based on a couple of factors over various timeframes. It can be found here. You can click the download to excel and check out the quarterly statistics. As far back as 1992, sometimes inflation approaches 3.5%, but stays below, often significantly below. In 1991 and previous years, however, it bounces around a lot (14+% year-over-year inflation in the first 2 quarters of 1980, yowza!)
However, as I said before, inflation can be calculated in a multitude of different ways, so in all likelihood you've primarily seen stats based on a different marker.