What’s the fiscal hit from higher yields?
A long answer to a simple question
Higher interest rates on U.S. Treasury debt mean the government pays more to service its obligations. This increase in interest payments can put a strain on the federal budget, potentially leading to reduced spending in other areas or increased deficits. The scale of this fiscal hit depends on how high yields rise and for how long.
- The U.S. Treasury pays 3.4% interest on its debt.
- Higher yields increase the cost of servicing national debt.
- Increased interest payments can impact the federal budget.
Continue reading https://www.ft.com/content/63311687-676b-4548-9bd8-3d7ad96d7ce5
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