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Data shows that the cost of financing U.S. debt has increased significantly, with Treasury yields reaching their highest levels in 19 and 25 years for 10- and 30-year bonds, respectively. In July 2026, the U.S. government issued 10-year bonds with a yield of 4.683% and 30-year bonds with a yield of 5.216%, leading to higher borrowing costs. The rise in yields is driving up debt servicing expenses, with an expected budget deficit of $1.9 trillion in fiscal year 2026. It is also anticipated that interest costs will exceed $1 trillion, reflecting growing pressure on public finances due to rising debt levels—projected to reach 120% of GDP by 2036. Moreover, an increased maturity premium will compel the government to rely more on short-term instruments, raising refinancing risks and potentially worsening foreign demand for its bonds.
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