- Thursday’s 10-year TIPS reopening looks likely to get a real yield to maturity of around 0.64%, well below January’s 0.919%.
- Investors will pay a premium, because the real yield will be well below the coupon rate of 0.875%.
- U.S. Series I Savings Bonds currently carry a fixed rate of 0.50%, making them very attractive versus a 10-year TIPS at 0.64%.
I can’t recommend buying a 10-year TIPS with a real yield of 0.64% when U.S. Series I Savings Bonds currently carry a fixed rate of 0.50%. That fixed rate, available for purchases through April 30, is equivalent to the I Bond’s “real yield.”