The Surprising Reason Wednesday’s CPI Numbers Could be Good for Warsh and Bad for Social Security

The article says May CPI came in hot, with inflation up 4.2% year over year and energy prices rising 3.9% in May after prior monthly gains, largely driven by the Iran conflict. While this is bad news for retirees because it points to a larger 2027 Social Security COLA, the piece argues that a higher COLA mostly reflects stronger inflation rather than real purchasing-power gains. For the Fed, the report may actually help new chairman Kevin Warsh by giving him cover to reject pressure from President Trump for rate cuts. Combined with a May jobs report that beat expectations, the inflation data reduces the odds of near-term easing and supports a steadier or even hawkish Fed stance, which markets have largely priced in.