US debt topped $40 trillion for the first time, reaching $40.047 trillion on August 18, as rising borrowing and interest costs intensified concerns over the federal fiscal outlook, Treasury Department data showed.
The Treasury’s daily statement put debt held by the public at $32.266 trillion and intra-governmental holdings at $7.782 trillion as of Tuesday.
Federal debt has more than doubled from $19.95 trillion in January 2017, when President Donald Trump began his first term. The source attributes part of the increase to pandemic-era borrowing under Trump and former President Joe Biden, as well as longer-running tax and spending imbalances.
Maya MacGuineas, president of the nonpartisan Committee for a Responsible Federal Budget, said the $40 trillion threshold came less than five months after debt reached $39 trillion. The group warned that continued borrowing could increase pressure on inflation, federal spending priorities and the government’s ability to respond to future emergencies.
Bond-market pressure has also intensified. After a $25 billion auction of 30-year Treasury bonds cleared at its highest yield since 2021, long-term yields reached nearly two-decade highs, according to the source.
US Treasury Secretary Scott Bessent responded Wednesday by doubling planned buybacks of 10- to 30-year Treasuries to at least $4 billion per operation.
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The Treasury also reported a $432 billion July deficit, the fourth-highest monthly shortfall in US history. Interest costs reached about $1.1 trillion, while mandatory programs such as Social Security, Medicare and Medicaid accounted for roughly 60% of the approximately $7 trillion annual federal budget.
The Congressional Budget Office estimates Trump’s One Big Beautiful Bill Act will add another $4.7 trillion to federal debt.
