Real return bonds

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Real return bonds, unlike regular bond issues, are indexed to inflation. Often, this involves recalculating the outstanding principal with an inflation multiplier. Since the interest rate is being paid on this new, indexed principal amount, inflation is not a factor, and the interest rate on the bond is a "real" return. Real return bonds normally have lower interest rates than comparable regular bonds, since the purchaser does not have to factor inflation into their return from the bond.

The 2008 Bonds issued by the DCBC are real return bonds.

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