US debt interest costs hit $3 billion a day and jumped 8% in 2026-faster than spending, revenue, GDP

Key Points:

• The U.S. federal budget deficit widened to $1.99 trillion in fiscal 2026, a 12% increase from the previous year, as spending grew 6% to $7.4 trillion while revenue increased only 3% to $5.4 trillion.
• Interest payments on the national debt reached $1.36 trillion at an average rate of 3.53%, more than double the rate in 2021, making them the third-largest federal expenditure after Social Security and Medicare.
• Net interest payments rose 8% to $1.05 trillion, outpacing GDP growth and representing about $2.9 billion per day, with projections indicating interest costs will be the fastest growing part of the budget due to rising debt and borrowing costs.
• Treasury Secretary Scott Bessent is issuing more short-term debt amid market volatility, with over $10 trillion of publicly held debt maturing within 12 months, requiring refinancing at higher interest rates.
• Experts warn that without fiscal intervention, rising interest costs and debt could trigger a financial crisis, but political willingness to address spending or revenue remains low, and economic growth alone is unlikely to stabilize the debt trajectory.