US debt spiral could start soon as interest rate on borrowing tops GDP growth
Fortune • • business
Key Points:
- The Congressional Budget Office projects U.S. publicly held debt to rise from $31 trillion (about 100% of GDP) to 120% of GDP by 2036, surpassing the post-World War II record of 106%.
- Interest costs on the debt are expected to more than double to $2.1 trillion by 2036, driven by rising Treasury bond yields and higher average interest rates, which will consume a larger portion of federal spending and worsen budget deficits.
- The CBO forecasts slower economic growth, with nominal GDP growth declining from 4.1% in 2025 to 3.8% in 2027, while average interest rates on federal debt will rise from 3.316% currently
