Inflation-linked bond - Financial definition
Concise definition of the term inflation-linked bond
Bond whose cash flows are partially or entirely linked to an inflation index. This type of bond protects its holder against inflation risk and guarantees him a real interest rate as opposed to classic bonds which pay a nominal interest rate.
Comprehensive definition of the term inflation-linked bond
In return for the protection against inflation, the nominal coupon rate for inflation-linked bonds is generally lower than that of a comparable bond that is not index-linked .