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The chart above shows inflationary expectations from January 2004 to April 2008, calculated as the spread between: a) the yield on regular 10-Year Treasury notes (constant maturity, data here) and b) the yield on 10-Year Treasury Inflation-Indexed Securities (data here).

The data suggest that a) inflationary expectations are going down, not up (see trend line above) and b) inflation expectations were much higher in 2004, 2005 and 2006 than in 2007 and 2008.

Source: Are Inflationary Expectations Deflating?