Direct Answer
10-Year Breakeven Inflation Rate is a daily economic indicator published by Federal Reserve Bank of St. Louis for the United States. It measures market-implied inflation expectations over the next ten years and is used by investors, economists and policymakers to assess the economic environment. Changes in the indicator can influence monetary policy expectations and asset prices across equities, fixed income and currency markets. This page is an educational guide and does not provide investment advice.
10-Year Breakeven Inflation: Latest Reading, Historical Chart, Release Date & Investor Guide
Indicator Snapshot
| Field | Detail |
|---|---|
| Common name | 10-Year Breakeven Inflation |
| Full name | 10-Year Breakeven Inflation Rate |
| Geography | United States |
| Publisher | Federal Reserve Bank of St. Louis |
| Release frequency | Daily |
| Category | Monetary Policy And Rates |
What 10-Year Breakeven Inflation Measures
10-Year Breakeven Inflation Rate measures market-implied inflation expectations over the next ten years. The indicator is published by Federal Reserve Bank of St. Louis on a daily basis and is one of the primary datasets used by investors and economists to monitor this area of the economy.
Market-implied average annual inflation rate over the next ten years, in percent, measured as the gap between nominal and inflation-indexed ten-year Treasury yields. It is a daily series published by FRED and is not seasonally adjusted.
Why Investors Watch 10-Year Breakeven Inflation
Breakevens show what bond markets are pricing in for average inflation over a decade, which investors compare with the Federal Reserve inflation objective of 2 percent. Shifts in the series show changing inflation compensation demanded in nominal bonds relative to TIPS.
The indicator's impact on financial markets depends on multiple factors: whether the reading was expected, the current economic regime, central bank policy stance, and investor positioning. A single data point is rarely sufficient to draw firm conclusions.
How 10-Year Breakeven Inflation Is Calculated
The value is the 10-year Treasury constant maturity yield minus the 10-year TIPS constant maturity (real) yield, both taken from Treasury yield curves. The gap reflects expected inflation plus an inflation risk premium, adjusted for liquidity differences between TIPS and nominal bonds, so it is not a pure forecast.
The official methodology documentation from Federal Reserve Bank of St. Louis describes the full calculation process including sample design, weighting and revision procedures.
Reference: Federal Reserve Bank of St. Louis: 10-Year Breakeven Inflation data and methodology
Release Schedule and Revisions
10-Year Breakeven Inflation is typically released daily by Federal Reserve Bank of St. Louis. Release dates are announced in advance through the official release calendar. Investors should monitor both the scheduled release dates and any unscheduled revisions.
This series is a market-observed price, rate or index level, so the published value is not normally revised after release. Check the publisher's notes for the occasional correction or methodology change.
How to Interpret 10-Year Breakeven Inflation Changes
When analyzing 10-Year Breakeven Inflation data, investors should consider multiple dimensions simultaneously:
- A higher breakeven means nominal Treasuries are paying more relative to TIPS, which is read as higher expected average inflation over ten years plus some inflation risk premium.
- Compare it with the Fed's 2 percent goal while remembering that TIPS are indexed to CPI, which has tended to run somewhat above the PCE measure the goal refers to.
- Falling breakevens alongside falling nominal yields often come from weaker growth or lower oil prices, while a rising breakeven with a steady real yield points to inflation compensation.
Market Impact of 10-Year Breakeven Inflation
10-Year Breakeven Inflation can influence multiple asset classes depending on its implications for economic growth, inflation, and monetary policy:
- Equities: Changes in 10-Year Breakeven Inflation can affect earnings expectations, discount rates and sector rotation preferences.
- Fixed income: The indicator may influence Treasury yields and credit spreads depending on its monetary policy implications.
- Currency markets: Divergence in 10-Year Breakeven Inflation across economies can affect relative currency valuations.
- Commodities: Economic activity indicators can affect commodity demand expectations and prices.
Historical Context
10-Year Breakeven Inflation Rate has a long history that provides context for interpreting current readings. Key reference points include major economic cycles, recessions, recovery periods and policy regime changes. Historical comparison helps investors avoid placing excessive weight on any single data point outside its longer-run context.
Investors should be aware that methodology changes over time can affect comparability across long historical periods. The official Federal Reserve Bank of St. Louis documentation will note any significant definitional or methodological changes.
Limitations of 10-Year Breakeven Inflation
Like all economic indicators, 10-Year Breakeven Inflation has limitations that investors should understand before drawing conclusions:
- Breakevens mix inflation expectations with an inflation risk premium and a TIPS liquidity premium, so the spread is not a pure forecast of inflation.
- TIPS accrue CPI with a lag of about three months, and market stress can cheapen TIPS and push breakevens down even when inflation outlooks are unchanged.
- No single indicator captures the full complexity of economic conditions, so read this series next to the ones linked below.
Related Economic Indicators
10-Year Breakeven Inflation is best interpreted alongside related indicators that provide complementary perspectives on market-implied inflation expectations over the next ten years. Confirming or diverging signals across related indicators help investors form more robust views of the economic environment.
See the Monetary Policy And Rates indicators section and the Macro & Market Regimes hub for broader context and related data.
Frequently Asked Questions
What is 10-Year Breakeven Inflation?
10-Year Breakeven Inflation Rate is a daily economic indicator for the United States. It is published by Federal Reserve Bank of St. Louis and is used by investors, economists and policymakers to assess market-implied inflation expectations over the next ten years.
Who publishes 10-Year Breakeven Inflation?
10-Year Breakeven Inflation is published by Federal Reserve Bank of St. Louis. The official data, release calendar and methodology are available at the Federal Reserve Bank of St. Louis website.
When is 10-Year Breakeven Inflation released?
10-Year Breakeven Inflation is typically released daily by Federal Reserve Bank of St. Louis. Exact release dates are announced in advance through the official release calendar.
How is 10-Year Breakeven Inflation calculated?
The value is the 10-year Treasury constant maturity yield minus the 10-year TIPS constant maturity (real) yield, both taken from Treasury yield curves. The gap reflects expected inflation plus an inflation risk premium, adjusted for liquidity differences between TIPS and nominal bonds, so it is not a pure forecast. Refer to the official Federal Reserve Bank of St. Louis methodology documentation for the complete calculation procedure.
What does a higher 10-Year Breakeven Inflation reading mean?
A higher 10-Year Breakeven Inflation reading can signal changes in market-implied inflation expectations over the next ten years. The market impact depends on whether the reading was above or below consensus expectations, the prevailing economic cycle, and current monetary policy context. Investors should not rely on any single data point to drive portfolio decisions.