Real yields
Updated
What it is
Real yields are bond yields adjusted for expected inflation, typically measured via Treasury Inflation-Protected Securities (TIPS). They reflect the inflation-adjusted cost of government borrowing and serve as a gauge of how tight or loose monetary and financial conditions truly are.
Why it matters lately
The 10-year TIPS real yield rose from about 1.94% on January 2, 2026 to a reopening-auction yield of 2.653% in mid-September 2026, the highest for that tenor since 2008, and reportedly reached 2.76% on September 23, 2026. The rise accompanied the Fed's September 16, 2026 rate hike and a broader Treasury selloff that pushed nominal 10-year yields above 5%, the highest since 2007.
Asymmetric Analytics view
Inference (AA): ELSI treats the 2026 real-yield surge as corroborating evidence that financial conditions tightened materially independent of, and partly ahead of, the Fed's own hike.