U.S. Federal Debt Reaches $40 Trillion

Why it matters locally: An increasing national debt could impact federal funding for infrastructure projects and social programs that benefit New York residents, while rising interest rates could affect municipal borrowing costs for entities like New York City Hall.

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WASHINGTON – The U.S. federal debt reached $40 trillion this week, marking a new financial milestone. This figure represents a doubling of the federal debt since 2017. The government currently allocates over $1 trillion annually to cover interest payments on this accumulated debt. Investors purchasing government bonds have increased their demands for higher interest rates as the debt load grows.