washington: The total US public debt has surpassed $40 trillion for the first time in its history, marking a structural shift in federal borrowing burdens amid escalating pressure on bond markets and rising debt servicing costs.

According to Iraqi News Agency, official data from the US Treasury Department shows that the debt is comprised of $32.3 trillion in publicly held debt and approximately $7.8 trillion in domestic government holdings, more than doubling the total debt compared to 2017 levels.

This increase coincided with a surge in the yield on 30-year US Treasury bonds, exceeding 5.3%, its highest level in nearly two decades, while mortgage rates approached 7%, placing additional financing burdens on corporate and personal loans linked to Treasury bonds.

To calm markets, US Treasury Secretary Scott Bessent announced a doubling of the maximum limit for long-term government bond repurchases, raising it from $2 billion to at least $4 billion per transaction, starting September 9. This led to a slight decline in bond yields, settling near 5.2%.

Economic observers believe that the rising interest payments-which now constitute nearly half of the projected budget deficit for this year-are creating a cycle of increased borrowing to service existing debt, particularly given rising social welfare and military spending.

This hinders the goal of reducing the federal deficit to 3% of GDP by 2028. Attention is now focused on the Federal Reserve’s plans to reduce its $6.8 trillion bond portfolio, which could increase the supply of bonds in the market and exert further upward pressure on borrowing costs.

On the international level, this surge is raising concerns for emerging markets and governments that rely on external borrowing, as higher returns on dollar-denominated assets are attracting capital to the US market and increasing the cost of financing globally, amid questions about the sustainability of the US economy in bearing the escalating cost of borrowing in the long term.