The US federal debt has crossed the 40 trillion dollar mark for the first time. This is evidenced by data published on Wednesday by the country's Treasury Department.
According to the department, authorities plan to buy back additional volumes of long-term government bonds. The goal is to curb the rising cost of borrowing.
In response, the yield on 30-year Treasury bonds fell slightly to 5,18%. Previously, investor concerns regarding inflation and the massive volume of debt had pushed this yield to its highest level since 2007.
The situation underscores how seriously the growing debt is affecting financial markets. How will this impact economic policy in the coming months?
For now, the Treasury is focused on stabilizing the situation through operations in the bond market. Analysts note that such steps may temporarily calm market participants but do not resolve the fundamental issues of public finance sustainability.
