Authored by Jack Phillips via The Epoch Times(emphasis ours),

A senior citizens group has forecast that the cost-of-living adjustment (COLA) for Social Security payments will increase by 3.9 percent next year,more than 1 percentage point higher than last month’s prediction.

The Senior Citizens League, which issues monthly projections on the COLA for Social Security, said in a statement Tuesdaythe 3.9 percent for 2027 is already higher than the 2.8 percent increase that went into effect in 2026. The group in April had forecast a 2.8 percent increase for next year’s payments.

“Fast-rising oil prices could have downstream effects on the economy and push inflation even higher,” potentially leading to a higher COLA projection, the group said, adding that research has show that higher gas prices can lead to higher prices across the board.

The COLA for next year is usually announced by the Social Security Administration in October and is based on Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) reports issued by the Labor Department for the months of July, August, and September.

The group’s forecast Tuesday came as the department released its monthly CPI report, which found thatinflation in April increased by 0.6 percent month over month, along with a 3.8 percent annual increase.

According to the Labor Department’s report, the rise in inflation was in part caused by higher gasoline, energy, and fuel prices. The gasoline index rose 5.4 percent over the past month while gas prices increased 11.1 percent in April, and the fuel index increased by 5.8 percent, it found.

Data released by the American Automobile Association (AAA) showed that as of Thursday, the average price of a gallon of regular gasoline rose by 2 cents to $4.53 nationwide. Diesel rose by 1 cent to $5.66 per gallon, according to the data.

Just two days before the U.S.–Iran war started in late February, regular gasoline cost around $2.98 per gallon on average nationwide, according to AAA.

After the United States and Israel launched strikes on Iran on Feb. 28, Tehran effectively closed off access to the Strait of Hormuz, through which a fifth of the world’s oil and liquefied natural gas passes. The choking off of the strait has sent energy prices higher and has rattled world markets.

Source: ZeroHedge News