United States Treasury debt rose to $39.5 trillion, a record high. As the United States debt issued during the period of low interest rates matures, the United States Government is refinancing at a higher cost, fiscal pressure is further increased, and the market is reassessing the relationship between debt, interest rates and risk assets.

Over $4 trillion in two years.

As of July 2026, the United States Treasury debt had increased by more than $4 trillion compared to about $35 trillion in July 2024. Some market tracking data show that the size of the debt has increased by about $28.6 billion over the past 30 days, and the pressure on the federal deficit continues to grow.

Publicly held federal debt has also exceeded US GDP, re-emerging 100% or more of GDP. This is a rare post-World War II level, and it has also raised a new level of debate in Washington around spending, taxation, borrowing and long-term fiscal arrangements.

Steve Rattner, a former U.S. Treasury official, said that US federal debt had exceeded 100% of GDP and could have surpassed its pre-high point by 2030. This figure is again the focus of policy discussions as the debt ceiling dispute approaches again.

Interest expenditure continues to rise.

The rising debt burden has been accompanied by increased financing costs. The low-interest dollar debt that was previously issued at 1 to 2 per cent rates was due, and the new debt needed to be issued at the current higher rate of return.

Currently, the United States has an annual national debt return of about 4.58 per cent and a 30-year national debt return of about 5.08 per cent. This means that the Ministry of Finance has to bear higher interest costs in rolling finance.

  • 2026 Projected net interest expenditure for the fiscal year of approximately $1.04 trillion
  • Interest expenditure accounts for approximately 14 per cent of total federal expenditure
  • Related expenditures have become one of the fastest-growing projects in the budget

The Chairman of the United States Responsible Federal Budget Commission, Maya MacGuineas, had previously stated that the continued expansion of debt reflected the long-standing failure of both parties to make difficult financial trade-offs. The related statement highlights once again that the United States debt problem is no longer just short-term deficit fluctuations, but rather pressures on long-term fiscal structures.

Market synchronized attention to leverage and bitcoin proposals

Investor leverage is also rising at a time of high debt innovation. The United States reported an increase of approximately $86.5 billion in its bond financing balance in June, to $1.5 trillion, for the third consecutive month.

Over the past year, the cumulative increase in the United States bond financing balance was nearly $49.4 billion, indicating that investors borrowed additional funds to buy equities. Leverage increases are usually magnified at the upswing stage, but may also increase sales when prices fall.

At the same time, some United States politicians are linking the debt problem to discussions on alternative reserve assets. Senator Cynthia Lummis continued to support the BITCOIN Bill, proposing that the United States Treasury purchase 1 million bitcoin over five years as a strategic reserve tool for weakening the dollar.

The United States Government Accountability Office warned that the current financial path was unsustainable. As the size of the national debt approaches $40 trillion, the United States Government will then face increased pressure for borrowing management, interest expenditure and budget reform.