SHORT ANSWER
The core idea
Inflation-linked bonds can fall even when inflation rises because their prices also depend on real yields.
THE MECHANISM
What is happening underneath
If real yields rise enough, the negative price effect from higher discount rates can outweigh the benefit of greater inflation adjustment.
MARKET INTERPRETATION
How investors should read it
This is why inflation protection and short-term market performance are not the same thing.
BONDSTATS TAKEAWAY
The same market move can carry different information depending on which maturity, issuer and risk premium is changing. Read the question together with the underlying concepts rather than treating one price move as a universal signal.
RELATED CONCEPTS
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