Nominal rates lie. Real rates tell the truth. After stripping inflation, are you actually earning anything on your savings — or is your wealth quietly eroding? This chart reveals the answer.
10-Year Treasury yield minus inflation rate. Negative values indicate favorable conditions for market growth.
Thresholds: Negative ≤-1 • Warning ≤1 • Positive >1
Today's reading sits at the 89.9th percentile of 282 months since 2003.
3 years • Current: 2.43 • 3-month change: +0.54 (+0.54%) • Source: FRED DFII10 (10-Year TIPS constant maturity), daily
Real interest rates represent the true cost of borrowing and the true return on savings after inflation is stripped out. They are arguably the most important price in the entire economy.
Real rates were deeply negative throughout 2020-2022 as the Fed held rates near zero while inflation surged to 9%. This fueled massive asset price inflation. The subsequent rate-hiking cycle pushed real rates sharply positive, contributing to the 2022 bear market. The current real rate regime is critical for understanding where markets head next.
Market cap to GDP — Warren Buffett's favorite valuation metric
10Y-2Y spread — recession predictor linked to rate dynamics
CAPE ratio — 10-year smoothed market valuation
Dollar strength driven by rate differentials
M2 money supply — the liquidity side of the equation
Every formula, source series and threshold behind these numbers
Real interest rate data provided for educational purposes only. Not investment advice.