A new government economic forecast warns there may be no cost-of-living adjustment in federal civilian and military retired pay until 2013.

A revised economic outlook issued Wednesday by the nonpartisan Congressional Budget Office warns that the consumer prices on which Social Security and government retirement increases are based are likely to stay low.

Downward pressure includes workers willing to accept lower salaries to avoid unemployment, landlords accepting lower rent and businesses reluctant to raise prices for fear of further slowing meager sales, the report says.

COLAs for retired pay and Social Security are linked to the Consumer Price Index, a Labor Department measure of the cost of goods and services. Over the past 12 months, the index shows consumer prices have dropped by 2.1 percent — deflation, rather than the more familiar inflation.

Retired pay and Social Security would not be cut if consumer prices continue to fall. The worst that could happen would be no increase on Dec. 1, when COLAs officially take effect.

The report projects consumer prices are likely to range between a half-percentage point drop and a half-percentage point increase through 2015.

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