The CPI-U value for February increased again to 212.193. This is still well below September's value of 218, so it is virtually impossible to have a positive value for the variable portion of I bonds for the next cycle.
| Sept. | Oct. | Nov. | Dec. | Jan. | Feb. | Mar. |
| 218.783 | 216.573 | 212.425 | 210.228 | 211.143 | 212.193 |
At this point, it is almost certain all I bonds will see a rate of 0% for the 6-month cycle starting on May 1. The deflation aspect of the formula is simply too large a negative value to produce a positive return. Since the composite rate cannot be negative, the rate will be 0%. As previously purchased bonds hit their 6-month anniversary, the rate will drop to zero. In order for a new I bond to offer a non-zero rate, the fixed rate would have to be over 6%, which is not very likely.
The highest fixed rate ever was 3.60%, so maybe we can see an adjustment to something close to that again. Even with a 0% rate for 6 months, a high fixed-rate I bond would be a good investment if held for a long period of time. The bonds with the 3.60% fixed rate were earning 9.4% in November 2005!
