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Question 1022  inflation linked bond, breakeven inflation rate, inflation, real and nominal returns and cash flows

Below is a graph of 10-year US treasury fixed coupon bond yields (red), inflation-indexed bond yields (green) and the 'breakeven' inflation rate (blue). Note that inflation-indexed bonds are also called treasury inflation protected securities (TIPS) in the US. In other countries they're called inflation-linked bonds (ILB's). For more information, see PIMCO's great article about inflation linked bonds here.

The 10 year breakeven inflation rate (blue) equals the: