BusinessQuiet 85d · day 86
US national debt passes $40 trillion as Treasury doubles bond buybacks
A record debt load and a bond-market buyers' strike prompted Washington to expand debt repurchases the same day the $40 trillion threshold was confirmed.
What to know
- The $40 trillion debt figure arrived about two fiscal years earlier than the CBO's May 2023 projection of 2028, with debt climbing from $38T to $40T in under a year.
- Treasury's buyback expansion, doubling the per-operation cap to $4 billion, is modest relative to the $32 trillion Treasury market it aims to steady.
- Higher yields and rising debt reinforce each other: bigger borrowing pushes yields up, and higher yields raise the interest bill that adds to future debt.
- Economists are split on whether the buyback move addresses the underlying strain or is a stopgap that raised expectations of further intervention.
Donald Trump US PresidentUS Treasury Federal debt issuer
Mohamed El-Erian EconomistThomas Simons Chief US economist, JefferiesDavid Young President, Conference Board's CEO Center
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