As per the Consumer Price Index or CPI inflation increased .3% in September and on a year ago basis it gained 1.5% according to the Bureau of Labor Statistics. Largely driven by significant increases in energy costs and to a lesser extent housing, or rent. The ex food and energy core rate gained .1% for the month and 2.2% on a year ago basis. Moving to the Cleveland Fed index and we find that prices gained .2% for the month and 2.1% from a year ago. The 16% trimmed mean index advanced .2% for the month and 2.1% from a year ago. So there you have it the trifecta of price measuring indexes north of 2.1% on an annualized basis through September.
Having said all that, the Social Security Administration released its 2017 COLA or Cost of Living Adjustment for 2017. Now admittedly this is based on historical data not quite as current as September and keep in mind that the Social Security Administration also has a vested interest in keeping its COLA adjustments as low as possible considering the precarious financial state of its programs. If you’re thinking that the 2017 COLA adjustment has to be at least 1% in all fairness based on recent news reports, you would be mistaken. The official COLA adjustment for 2017 is just .3% as per todays press release from the Social Security Administration. Not 2.1% but just .3%, and that tells you just about everything you need to know about the lamestream media’s accuracy of the reporting related to the various price metrics, not that they have an agenda of course.