COLA remains flat across most of Europe
Don’t expect anything extra holiday shopping money in your next paycheck: Cost-of-living allowances paid to U.S. troops in Europe will not change at most bases for the first half of December.
At a small number of locales in Italy and Belgium, modest increases in COLA go into effect Saturday. The changes resulted from exchange-rate adjustments, according to the Defense Department’s Per Diem, Travel and Transportation Allowance Committee’s Web site.
Troops stationed at those bases will notice the adjustments in their midmonth pay.
But COLA will remain flat for at least the next two weeks at all locations where significant numbers of U.S. troops are based in the United Kingdom, Germany and Spain.
At Aviano Air Base, Italy, where COLA went up by about 11 percent in the middle of November, the allowance jumps about another 5 percent on Saturday.
An Aviano-based E-5 with four years of service living off base with two dependents will get $442.75 in COLA for the first 15 days of December, up from $421.67 for the last 15 days of November.
COLA rates are also up at Supreme Headquarters Allied Powers Europe and in Chievres, Belgium. At both locales, an O-4 with 12 years of service and three dependents will get $941.67 in COLA for the first 15 days of December, up from $904 for the last 15 days of November.
COLA rose two weeks ago in Germany, Italy, Spain and the Benelux, but was stagnant in the U.K., where the British pound cost $2.12 on Friday at on-post banking facilities. COLA last rose in the U.K. in mid-October.
At RAF Lakenheath, an E-5 with four years of service living off base with two dependents will get the same $421.67 for the first 15 days of December that he got for the last two weeks of November.
Individual COLA varies according to a member’s rank, years in service and number of dependents, among other factors.
Recent news, however, indicates that more COLA hikes could be in store. After a short rally, in the last few days, the dollar dropped slightly on Friday afternoon.
Federal Reserve officials have boosted U.S. investors’ hopes of interest rate cuts, according to The Associated Press. Fed Vice Chairman Donald Kohn, in a speech before the Council on Foreign Relations, said Fed policymakers must be “nimble.” His remarks on the recent turmoil in the financial sector — and how that might tighten lines of credit for businesses and consumers — led investors to hope that more interest rate cuts may be in store.
Although lower interest rates can jump-start an economy, they can also weaken a currency as investors transfer funds to countries where they can earn higher returns, the AP reported.