WASHINGTON, July 11 — The United States Treasury is now borrowing $155 billion every single month of the current fiscal year, a pace that signals the government’s deepening reliance on debt markets to finance its operations. This monthly borrowing figure, sustained since the fiscal year began on October 1, 2023, provides a stark measure of the gap between federal revenue and spending. The broader stakes of this borrowing are visible in the interest bill.
As of mid-2024, the Treasury is paying approximately $24 billion per week in interest on the national debt. That figure, drawn from the Treasury’s daily statement and analysis by the Peter G.
Peterson Foundation, a nonpartisan fiscal policy organization, reflects the sharp rise in interest rates engineered by the Federal Reserve. The federal funds rate now sits in a range of 5.25% to 5.5% as of July 2024, a level that has dramatically increased the cost of servicing the nation’s debt. The national debt itself crossed $34 trillion in January 2024, according to the Treasury Department.
On an annualized basis, interest payments now exceed $1 trillion per year, a sum that represents a growing and significant portion of federal spending. This is not an abstract fiscal concern; it is a concrete constraint on the government’s ability to fund other priorities.
The Drivers of the Deficit
The structural forces behind this borrowing are well understood. The federal budget deficit stood at $1.7 trillion in fiscal year 2023. That shortfall is driven by increased spending on mandatory programs such as Social Security, Medicare, and defense, combined with the interest rate environment.
The Treasury borrows by issuing securities — Treasury bills, notes, and bonds — which are sold at auction through the Bureau of the Fiscal Service. Treasury Secretary Janet Yellen oversees the debt management strategy, a role that has become increasingly central as borrowing costs climb.
The Congressional Budget Office projects that net interest costs will reach $870 billion in fiscal year 2024, and then rise to $1.4 trillion by 2034. That trajectory, if realized, would make interest payments one of the largest single categories of federal spending within a decade.
The Debt-to-GDP Trajectory
The CBO’s projections also illuminate the broader macroeconomic calculus. The debt-to-GDP ratio currently stands at about 99%. The CBO estimates that this ratio will exceed 100% in 2025 and reach 116% by 2034.
Crossing the 100% threshold is a significant marker: it means the national debt will be larger than the entire U.S. economy, a level historically associated with reduced fiscal flexibility and higher borrowing costs. Strategically, the combination of sustained monthly borrowing, rising interest rates, and a growing debt-to-GDP ratio presents a challenge for policymakers.
The $155 billion monthly borrowing figure is not a temporary spike; it reflects the ongoing structural deficit. The weekly interest payment of $24 billion is a recurring cost that compounds over time, consuming an ever-larger share of federal revenue. What this signals is a fiscal environment where the government’s financing needs are large and persistent, and where the cost of that financing is elevated by the Federal Reserve’s rate policy.
The Treasury must continue to roll over maturing debt and issue new securities to cover the deficit, a process that is sensitive to market conditions and investor demand. Looking ahead, the trajectory of interest costs will depend on the path of the federal funds rate and the pace of deficit reduction, if any.
The CBO’s projection of $1.4 trillion in net interest costs by 2034 assumes current law remains in place, including the scheduled expiration of certain tax provisions. Any changes to spending or tax policy would shift that forecast. For now, the numbers are clear: $155 billion borrowed each month, $24 billion paid in interest each week, and a national debt that has already surpassed $34 trillion.
