Inflation & Prices

10-Year Breakeven Inflation Rate

The 10-year breakeven rate is the nominal 10-year Treasury yield minus the 10-year TIPS (inflation-protected) yield. That spread is the average annual inflation the bond market expects over the next decade, the rate at which holding either bond would break even. Rising breakevens mean investors are pricing in hotter inflation; falling ones signal disinflation. Unlike CPI, which reports what already happened, this is a forward-looking market expectation that updates daily.