What Is the Real Interest Rate?
It measures your gain in buying power, not in money.
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1.What is the real interest rate?
It measures your gain in buying power, not in money.
2.What is the quick rule for the real rate?
With a 10 percent car loan and 2 percent expected inflation, the expected real rate is about 8 percent (St. Louis Fed).
3.Marge has 1,000 at 2 percent, and prices rise 3 percent. What is her real interest rate by the quick rule?
Her money grew on paper, but her buying power shrank by about 1 percent.
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Sources (5)
- Federal Reserve Bank of St. Louis, The Regional Economist (July 2016): Neo-Fisherism
- FRED / Federal Reserve Bank of Cleveland: 10-Year Real Interest Rate (REAINTRATREARAT10Y)
- FRED / Federal Reserve Board (H.15): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity, Inflation-Indexed (DFII10)
- U.S. Bureau of Labor Statistics: Consumer Price Index - September 2026
- Eigene Berechnung (synthetische Rechenbeispiele)
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