COLA Count Negative So Far

Through three months of the counting period toward the January 2007 federal retiree cost of living adjustment, the inflation index used to set that adjustment stands at a negative 0.1 percentage points, following a drop of 0.5 in December. The decline largely reflects a decrease in energy prices since a peak last autumn. The annual COLA count measures the change in the index’s average from one third calendar quarter to the next. Should the index stay in negative territory for the entire period, there is no provision for reducing annuities.