10-Year U.S. Treasury Real Return, Annualized, by Inflation Level and Direction

When inflation was 4% and falling, U.S. Treasury bonds delivered nearly 8% a year in real returns. The picture changes when inflation is high and rising. It’s not just the level of inflation that matters. It’s the direction.

Image: Real Investment Advice

10-Year U.S. Treasury Real Return, Annualized, by Inflation Level and Direction