Don't you just hate it when you read something but you don't know how to use what you've read?

Real interest rate= Nominal Interest Rate – Expected Inflation Rate
Nominal Interest Rate= Real interest Rate + Expected Inflation Rate

Yes, that happens to me a lot, because I try to understand very difficult concepts. I find that researching several internet sites is a very effective way to find different interpretations and simplifications of the information.

That is nonsense. That is why you can’t understand it. Interest is a price and it either moves with the market or it is price controlled. If things are not moving in a predictable way it is because of the information that is available to the players. There is much false information floating around as well as time specific information that no longer is valid. It is messy in the economic environment.

”...why is it important that nominal interest rate moves with inflation and that real interest rate is steady?”

It isn’t important. Carry on with your life, all will be well.

If you are going to pass a test on this subject, or enter the financial field, it is a good idea to have a grasp of the basic concepts. Often we don’t realize how our background and training is helping us in our daily life, because it is not in the actual details, but in the overall ability to solve problems.

yup i agree with yarnlady..