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2026-08-18T19:51:58.000Z

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US debt nears $40T amid rising borrowing costs

Data shows that the cost of financing U.S. debt has increased significantly, with Treasury yields reaching their highest levels in 19 and 25 years for 10- and 30-year bonds, respectively. In July 2026, the U.S. government issued 10-year bonds with a yield of 4.683% and 30-year bonds with a yield of 5.216%, leading to higher borrowing costs. The rise in yields is driving up debt servicing expenses, with an expected budget deficit of $1.9 trillion in fiscal year 2026. It is also anticipated that interest costs will exceed $1 trillion, reflecting growing pressure on public finances due to rising debt levels—projected to reach 120% of GDP by 2036. Moreover, an increased maturity premium will compel the government to rely more on short-term instruments, raising refinancing risks and potentially worsening foreign demand for its bonds.

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