The U.S. government’s debt interest burden reached a record high for fiscal 2026, eating up a growing share of federal revenue and risking a snowballing of borrowing that could leave the country more vulnerable to economic shocks.
For the year through September, net interest costs came to $1.05 trillion, up more than 8% from the $970 billion in fiscal 2025, Treasury Department data showed Friday. The Peter G. Peterson Foundation, a research group, sees the costs reaching 3.2% of gross domestic product, surpassing the previous record, reached in 1991. GDP figures for last quarter are due later this month.
The increase reflects both that there’s a lot more debt to pay interest on — one key measure exceeds $32 trillion, some $10 trillion more than just five years ago — but also much higher interest rates. The average rate the government paid on marketable Treasuries was 3.52% at the end of September, more than double the 1.47% five years before.
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