August CPI-U and I-Bonds

The CPI-U for August rose slightly to 215.834 over July's value of 215.351.

Mar.	Apr.	May.	Jun.	Jul.	Aug.	Sep.
212.709	213.240	213.856	215.693	215.351	215.834

 

With only one month remaining for this period, we should have a positive CPI-U rate for the November I-Bond. Hopefully the 0% days will come to a close soon.

 

I-Bonds and CPI-U values

July CPI-U Update

The CPI-U value for July decreased slightly to 215.351 from June's value of 215.693

Mar.	Apr.	May.	Jun.	Jul.	Aug.	Sep.
212.709	213.240	213.856	215.693	215.351

The next rate is based on the difference between Match and September, so we have 2 more periods to watch before estimating the next rate.

I Bonds

June CPI-U Update

The CPI-U value for June rose again to 215.693 from May's value of 213.240.

The CPI-U for this semi-annual period used to adjust the I Bond rate has increased 1.4% so far, with 3 more monthly periods left to measure.

Mar.	Apr.	May.	Jun.	Jul.	Aug.	Sep.
212.709	213.240	213.856	215.693

I Bonds

May CPI-U Update

The CPI-U value for May increased slightly over April's value of 213.240 to 213.856. The next I-bond rate is based on changes between March and September, so we still have a ways to go before making any predictions about the rate in November.

Mar.	Apr.	May.	Jun.	Jul.	Aug.	Sep.
212.709	213.240	213.856

 

I-Bonds

April CPI-U Update

The April CPI-U value increased to 213.240. This marks the 4th consecutive period of inflation.

We can now begin tracking the CPI-U values for the November I bond rate, which we all hope is better than the current 0% rate.

Mar.	Apr.	May.	Jun.	Jul.	Aug.	Sep.
212.709	213.240

The November I bond inflation-linked rate is based on the change in CPI-U between March and September, which we will know by mid-October.

I Bonds & CPI-U

Is the I Bond rate really 0%?

There have been a few questions whether or not the new I Bond rate is really 0%, or if that means there is no difference in rates from last time. Unfortunately, it means the rate your I Bonds will be earning is in fact 0%. If your bond is earning 5% right now, it will be dropping to 0% in the coming months.

Existing I Bonds will adjust to the new rate some time between May and October depending on when you purchased the bond. On the first day of the bond's 6 month anniversary of purchase, the bond will drop down to earning 0% for 6 months. It is the equivalent of having cash in your pocket for 6 months.

Thinking of selling? You should remember that I Bonds MUST be held for at least one year. Additionally, there is a penalty of 3 months of interest for redeeming within 5 years. If you want to sell a bond that is less than 5 years from issue, wait until the bond is 3 months into the 0% rate. That way, when you redeem the bond, the penalty is the past three months of 0% interest, meaning you lose no value as part of the penalty.

I Bonds Rate: 0% May - November 2009

The new I bond rate for May to November 2009 will be 0.0%, as expected. The fixed rate will unfortunately drop to 0.1%.

All I bonds will drop to 0% as the deflation measured this period was significant enough to offset even the highest fixed rate ever issued. I bonds adjust rates every 6 months based on the issue month, so between now and November, bonds will drop down as they reach their 6 month mark.


I Bonds Rates