If yields rise too much too quickly, the interest the US pays on its debt could force Congress to "question sustainability," UBS economists said.
The Fed has said it will hold interest rates near zero through 2023. The low rates ensure today's debt levels pose little threat, Powell said.
The CBO's report doesn't account for Democrats' $1.9 trillion stimulus, and could give Republicans more firepower in their fight against the bill.
The Congressional Budget Office expects federal debt to reach 102% of US GDP in 2021. The estimate doesn’t account for the $US1.9 trillion stimulus plan Democrats are set to pass. The CBO sees the debt pile then shrinking for a few years before rising into the next decade. Visit the […]
The Treasury Department said Wednesday the pandemic continues to cloud its future borrowing needs. Debt issuance ramped up in 2020 and will continue to do so as expenses mount, the department said. Still, the Treasury’s cash balance needs to be reined in ahead of a key debt-ceiling deadline. Visit the […]
Stock valuations were already outpacing the economy in 2019, and the coronavirus pandemic only exacerbated the issue. That poses a risk to the market’s climb in 2021, Seema Shah, chief strategist at Principal Global Investors, said in a blog post. Fundamentals and valuations continue to play second fiddle to the […]
The US federal budget deficit soared to a record $US3.1 trillion in the fiscal year that ended in September, according to Treasury Department data published Friday. The monthly budget report reflects the historic fiscal spending used to pad the US against the coronavirus pandemic, as well as the weakened tax […]
Major economies may be well on their way to recovery, but outsized government borrowing runs the risk of fuelling a financial crisis, World Bank Chief Economist Carmen Reinhart said Thursday. The path of governments’ fundraising and bond-buying is “not sustainable” and could spark debt crises should they continue, the economist […]
The Treasury market may no longer be able to function properly without the Federal Reserve’s intervention, according to Randal Quarles, vice chair of supervision at the central bank. The surging US debt pile forecasts a long period of increased bond issuance. The Fed’s purchasing of roughly $US80 billion of Treasurys […]
The Congressional Budget Office’s latest budget outlook sees federal debt becoming nearly twice the size of the US economy in 2050. Spending on economic relief throughout the coronavirus pandemic drove government debt to its highest since World War II. Higher borrowing costs and rising interest rates will drive debt to […]
Billionaire investor Leon Cooperman told Bloomberg that the Fed has created a “speculative bubble.” Cooperman said markets are not focused on the debt in the US that’s growing at a pace far exceeding the general economy. The investor said that he sees the continued “artificial support” for the economy as […]
The US Treasury announced on Thursday that the US deficit topped $US1 trillion for the first time since 2012. The deficit stood at $US1.067 trillion for the first 11 months of this year, which marks a 19% increase on this time last year. America’s government debt has widened during the […]
Congress has only weeks to pass a bill to raise the US government’s debt ceiling and avoid a technical default. The US Treasury will have “almost zero cash going into September” if Congress does not act, according to an analysis by Capital Economics, a research group. Currently, the Treasury is […]
More than 7 million Americans have gone into “serious delinquency” on their car loans. The automobile industries of the US and Europe have – for different reasons – started to show symptoms of something more serious happening in the Western economies. In Europe, many people have simply stopped buying cars. […]