Johnsey’s observation underscores the fact that it is crucial to consider “real interest” rates when evaluating investment options. However, even as nominal interest rates rise, inflation suppresses the real rate. In simplest terms, the real interest rate is the stated rate you see on the news, adjusted for price inflation. To calculate the real interest rate, you take the quoted nominal rate and subtract CPI. That means the real interest rate on a 10-year Treasury is only 1.1 percent (4.6-3.5=1.1).