US national debt hits record $40 trillion after doubling over 10 years

US national debt has more than doubled over the past decade, reaching a milestone of $40 trillion (£29.4 trillion), according to Treasury figures.

The increase reflects years of heavy government spending under both the Trump and Biden administrations, as well as rising interest payments that have steadily pushed the total higher. In 2016, the national debt stood at just under $20 trillion, Caliber.Az reports per BBC.

The Congressional Budget Office (CBO) had previously projected that total borrowing would reach $39.6 trillion by the end of fiscal year 2026.

The faster-than-expected increase has intensified concerns over the pace at which the US government's borrowing needs are growing and what this could mean for future interest costs. The CBO has warned that the United States is approaching its $41.1 trillion debt ceiling, while the national debt is projected to rise to around $64 trillion by 2036.

As the federal government continues to borrow more to cover budget deficits, consumers have also faced higher interest rates and inflation.

The $40.05 trillion recorded as of August 18 includes all outstanding US Treasury bonds, bills, and notes, highlighting the scale of government borrowing under the administrations of both presidents.

The interest rate on 30-year Treasury bonds, a form of government debt used to raise funds from investors, reached 5.34% on August 18, marking its highest level in nearly 20 years.

These rates, known as yields, influence how much the US government, businesses, and consumers pay to borrow money, affecting everything from mortgages and car loans to credit cards.

The recent surge in bond yields has been driven in part by rising oil prices linked to the US-Iran war, as investors grow increasingly concerned about inflation.

At the same time, concerns are mounting over the growing government debt burden and the huge amounts of money being borrowed by technology companies to fund artificial intelligence (AI) development, with the timing and scale of potential returns on those investments remaining uncertain.

By Jeyhun Aghazada