The RBA publishes interest rate data on both the 10 year Government bond rate and the CPI indexed bond rate.

The blue line is the rate for the 10 year Government Bond, which shows the peak of the 10% interest rate in 1995, the long period where the rate was around 6% between the year 2000 to 2008, and the sudden fall to 4% during the financial crisis.

I have derived the "Expected Average Inflation" by taking the 10 year bond rate away from the rate for the CPI bond. You can see that the Government Bond rate is closely correlated to the expected inflation over the period. In 2008 when the 10 year bond dipped to 4%, the reason was that the World expected inflation to plummet as the World faced a deep recession.

Out of interest, I have overlaid a chart of the Gold price. The Gold price started to move up in 2002 as Greenspan arguably kept interest rates too low for too long, thereby igniting the inflation scare. Gold appears to predict the rise in inflation a lot sooner than CPI indexed bonds do. Similiarly, Gold fell below $800 per ounce in 2008 quite a few months before the bond market reacted and inflation expectations reacted.

The burgeoning issues of Government debt and currency debasement probably favours a Gold price breakout to the upside, but a confirmation above the previous high is required. Even in this scenario, interest rates on Bonds may stay level for a time, witness the USA, but after that there may be a pronounced rise. This scenario also supports the boom in Australia's property market as the inflation bubble expands.

Back to the CPI bonds - currently they are yielding a real return of about 2.7% plus CPI capital growth. This 2.7% level has been the average rate for 10 years. It has been below 3% since 2004, and only dipped to 1.9% in the middle of the Great Recession. How CPI Bonds work is that an interest coupon (say 2.7%) is paid on the capital invested, but the capital keeps on growing (by CPI). So the coupon keeps getting paid on a bigger amount. The anomaly of the Australian tax system is that the ATO wants to tax you on the Capital Gain, even though you don't receive the cash until maturity. In an extreme example, if inflation went to 20%, then you would need to pay tax on the 20% increase in the capital amount. ie. You invested $100,000, which is then indexed in one year to $120,000. You earn 2.7% interest on the $120,000, but the ATO will also want to tax you on the $20,000, even though you don't receive it for 10 to 20 years. Investors will probably want a higher real rate of return to compensate for this loss of cash flow.