US national debt tops US$40t for first time, exceeds expectations

For the first time in history, the US gross national debt has surpassed the staggering figure of US$40 trillion, according to official data released by the Treasury Department. This alarming milestone, reached on Tuesday, surpassed initial projections and reflects the impact of controversial tariffs imposed by President Donald Trump.

As the debt continues to climb, concerns over inflation, geopolitical tensions, and government spending are fueling investor apprehension. Consequently, borrowing costs have escalated, pushing long-term Treasury bond yields to their highest level since 2007. To mitigate the rising bond market pressure, the Treasury Department intervened to lower yields.

The soaring debt burden, largely driven by a persistent deficit and rising interest payments, has left the federal government struggling to refinance existing obligations at higher rates. Economic experts warn that the unsustainable deficit spending trajectory could trigger a significant crisis, with the debt-to-GDP ratio serving as a warning signal for financial markets.

Despite the looming risks, policymakers must find a durable solution to address the growing public debt and its potential impact on the economy and consumer borrowing costs.