(December 2022) The global* debt owed by households, non-financial businesses and governments stood at $230 trillion in Q1 2022, up by more than one-third from a decade ago, according to data from the Bank of International Settlements (BIS). Although the world’s debt burden has declined from a pandemic-driven record early this year, the risks it poses to economies and financial markets are intensifying. That’s because many borrowers face a relentless increase in their interest payments, as the Federal Reserve and other central banks raise rates at the fastest pace in decades to subdue inflation. The danger is more acute for developing economies, especially those that borrowed in dollars.In the UK debt payments are on track to exceed 10% of all household income (not just for mortgage borrowers). In the Netherlands, Sweden, Norway, Australia, Canada and Korea they’re already well above that threshold—and heading toward 15%.The extent of the damage to the economy from high debt burden and rising debt costs is likely to depend on how high and fast central banks push interest rates to fight inflation. *40 largest economies tracked by BIS.
(January 2023) The cost to finance the US growing public debt is rising as the Federal Reserve raised interest rates to combat the inflation. In 2022 the Federal Reserve lift rates from almost zero to 4.5%, which makes it that much more expensive to finance the US debt.During 2022, the federal government made $710 billion in interest payments, up from $580 billion the prior year, according to the US Bureau of Economic Analysis (BEA). For context, that’s more than the government spent on education and social services. And it’s nearly as much as the $755 billion spent on education or $767 billion spent on national defense.The surging cost to service the US $31.4 trillion debt leaves less room for Government to spend on other priorities, including everything from infrastructure and the education and healthcare to the national defence.Other economic indicators show that the debt burden has not crossed the unsustainable level. For example, share of interest payments to current federal budget expenditures went up to 13.8% in Q4 2022. However, during three decades in 1970s, 80s and 90s share of spending on interest payments stood between 14 and 22% of current total expenditures.Data on government receipts and expenditures shows that the Federal budget deficit is narrowing. In 2022 Federal budget deficit lowered to $1.4 trillion or 5.4% of GDP, compared to $2.8 trillion (11.9% of GDP) a year ago. The U.S. economy finished 2022 in solid shape and if the economic growth will not turn negative in 2023, debt service will stabilise.
(November 2022) According to data from the Bank for International Settlements since the start of the COVID-19 pandemic non-financial sector debt of 40 largest economies increased by $36 trillion - from $194 trillion in Q4 2019 to $230 trillion in Q1 2022. The largest contributors to global non-financial sector debt increase were China and US. Since the end of 2019 non-financial sector debt in China and US increased by $16 and $10 trillion respectively, making up over 70% of global non-financial sector debt increase.
According to the U.S. Department of the Treasury the federal government ran a deficit of $431 billion in September 2022, the final month of FY2022. This deficit was the difference between $488 billion in revenues and $919 billion in spending. Receipts were up by $28 billion (6%), and outlays were up by $394 billion (63%) compared to September 2021. Timing shifts did move some payments to September that otherwise would have been paid in October (i.e., FY2023), contributing to the higher-than-expected deficit last month. More significantly, the Biden Administration’s announcement of a continued repayment pause on and forgiveness of federal student loan payments caused September’s deficit to be much higher than forecasted. Since federal accounting rules require these changes to be a one-time charge to the government, estimated costs of $426 billion were recorded by the federal government in September. In fact, student loan forgiveness was the single largest contribution to increased federal spending – and the deficit – in September (and in FY2022 overall), accounting for $379 billion. Given the sizeable impact of these one-time policy changes, it is difficult to discern year-over-year major trends for the month of September.
(04 November 2021) As a part its 2021 International Debt Statistics Report, the World Bank has published data on the external debt of emerging and developing countries, broken down by creditors. This data not only reveals countries — the largest single creditors — but can also be used to estimate the financial power of particular creditors within a specific debtor economy. Detailed external debt data from the World Bank is now available from Knoema.The World Bank data shows that since the 2008 global financial crisis China has dramatically increased lending to foreign countries. The total public and publicly guaranteed (PPG) external debt stock of emerging and developing countries that is owed to China increased from $11 billion in 2007 to $157 billion in 2019.Thirty-nine countries owe China over $1 billion. Pakistan, Angola, Ethiopia, Kenya and Sri Lanka have the largest debt to China. The graphs below explore the top lenders to emerging and developing economies, dig into the lending geography and totals of the major creditor countries, and provide detailed profiles of debtor countries. Choose a nation in the drop-down menu below to view country details at the bottom of this page. Definition: "External debt stock" is the amount of a country's debt borrowed from public or private foreign lenders. Source: The World Bank data was retrieved from WB IDS API and assembled by David Mihalyi and Balint Parragi.
(07 October 2021) At the end of June of 2021, the U.S. government hit the public debt ceiling of $28.4 trillion. According to U.S. Treasury Secretary Janet Yellen's estimates, under the existing debt limit the U.S. government will have to stop paying on its obligations such as social security programs, salaries and interest payments on treasury securities on October 18.Prolonged debates and lack of consensus in the U.S. Congress on the debt limit led to a stock market decline through September, on the expectation that government spending cuts to sustain the debt level amid high inflation will inevitably lead to an economic downturn.This week, Democrats and Republicans agreed to extend the public debt ceiling until December 3 and allow the US government to borrow an additional $480 billion.
(05 August 2021) To support the economy and health systems during the coronavirus crisis, governments had to increase spending, financing the increase mostly with growing debt. However, buildup in government debt doesn't necessary lead to the deterioration of fiscal stability, at least not in the short term. Eurozone countries, which on average increased government debt by 14% of GDP during 2020, now pay even less to serve higher debts than they did before the pandemic began.In 2020, government debt in eurozone countries increased by an average of 14.1 percentage points, to 98.4% of GDP. In 14 of the 19 eurozone countries, government debt increased by more than 10 percentage points. Government debt interest expenditures in the eurozone declined from 2.4% in 2019 to 1.5% of GDP in 2020, despite the increase in overall debt. For individual eurozone countries the decrease in interest expenditures ranged from 0.4 to 1.8 percentage points.Paying less total interest despite larger amounts of debt has become possible due to extremely low government bond yields. To keep government bond yields low, the European Central Bank has been purchasing public sector securities since the start of pandemic under the pandemic emergency purchase program and public sector purchase program. Since March 2020, the ECB has already purchased 1.6 trillion euro of government debt.
(02 February 2021) Based on the original paper by Dr. David L. Blond, Principle Researcher and President, QuERI-International. The views expressed are those of the author(s) and do not necessarily represent the views of Knoema Holdings and its Executive Board. In November 2020, US voters went to the ballot box and sent a Democrat back into the White House to stare down a federal deficit that grew under President Trump from $19 trillion in January 2016 to more than $27 trillion the day that Joe Biden was inaugurated. As you can imagine, the deficit hawks are out in force once again. The usual argument against more deficit spending, even in the midst of a disaster like the COVID-19 shutdown and prevailing economic conditions, is that the US can’t afford to spend that kind of money. For true deficit hawks it’s this idea of repaying the debt, of the burden on future generations, that leads to the ideal of fiscal conservatism. So, let’s pull that thread, as they say: If the United States were to adopt that logic and start down this repayment path, given the way the US allocates discretionary and non-discretionary expenditures, what options are available today?The US Department of Defense is the largest single discretionary expenditure in the Federal budget, a $750 billion budget item and growing. If you were to cut that in half and use the savings to pay down debt, in addition to trimming around the edges of discretionary social programs to the tune of another $25 billion, you could maybe net $325 billion to pay down the debt (after accounting for social assistance for jobs lost to cuts in the defense sector.) But this is not enough to slow the increase in the size of the debt outstanding because we still have to pay interest. If we turn to non-discretionary spending, we find that most of the money for Medicare and Medicaid goes to the oldest and frailest and the most costly to keep alive. So, what, we'd phase out government payments for people over 85? Gradually raise the retirement age and collect social security payroll taxes on all income earned without a cap, not cutting taxes? It is interesting how when you start to study the debt question and pull in the details over the past 40 years of debt, GDP, and interest rates, and match it against who was the US President at the time, everything becomes much clearer. So, too, does an essential point about the debt overhang and what it does or does not mean for an economy like the United States. Rather than focus on debt, we should also consider the relative usefulness of deficit spending, e.g the relative value of each dollar of debt to the change in GDP. Failure to spend is very likely more dangerous than spending too much.
Foreign holdings of US treasury bonds collapsed by a record $257 billion in March as liquidity constraints and the specter of COVID-19 affected foreign investors' portfolio decisions. Saudi Arabia, the largest seller of US treasuries in March, decreased its holdings of US government debt by $25 billion, according to the US Treasury Department. The oil market crisis significantly reduced the inflow of US dollars and forced the Kingdom to sell its most liquid assets.
(Fall 2017) Nowadays China is growing at rapid clip, averaging 10 percent growth per year. According to the World Bank, China is "the fastest sustained expansion by a major economy in history.” The United Nations classifies China as a developing country, but as Quartz reporting highlights, the official definition is...not exactly defined, officially.The two indicators commonly referenced to distinguish developed countries from developing countries are GDP per capita and the Human Development Index (HDI), with $25,000 the cutoff for GDP per capita and 0.88 the average HDI among developed countries. Today many speculate that the Chinese economy is a bubble, pointing to debt and the cost of bad assets. In the fourth quarter of 2016, the total debt of China exceeded the debt of the US by more than 250 percent. Whereas government debt is comparable with other countries, corporate and household debt of China has risen sharply. And this is the reason to worry. China's economic performance collapsed after the Great Recession of 2008. Demand for Chinese exports took the wind out of the economy. The slowdown in exports influenced not only production volume but also employment; the government said that more than 20 million migrants lost their jobs.In addition, manufacturing PMI, an indicator of the level of economic health of the manufacturing sector, hit the lowest level in years.According to Yu Bin, head of the micro economy research department at the State Council’s Development Research Centre, stable economic growth depends on a high-level of infrastructure investment. That's why following the 2008 crisis, infrastructure investment jumped by more than 50 percent in China. As a result, though, loans increased, too. So, let’s look at the Chinese economy now. As the second-largest economy in the world and the world's trade engine, a shock in China today is likely to have a similar economic shock as did the US housing credit bubble in 2008. Chinese companies are facing a decreased ability to pay. The number of healthy companies* fell by more than 30 percent between 20017 and 2016, from 577 companies to 845. In 2016, Fortune reported that China’s biggest banks lost more than ¥270 billion from writing off bad debts. In 2017, this figure has continued to grow. Explore these figures and more in our dashboard below. *Ratio is estimated based on net debt to EBITDA ratio.
Nigeria’s external reserves dropped to $40.7 billion at the end of Q3 2019, a single-quarter decrease of $4 billion. By the end of 2019, Nigeria’s external reserves dropped even deeper to less than $39 billion. As analysts began predicting that the falling reserves might force the Central Bank of Nigeria (CBN) to depreciate the naira, the CBN sought to calm markets and announce that the probability of a naira devaluation is low provided crude oil prices remain stable in 2020. Nigeria's current-account deficit narrowed in Q3 2019 to -2.3% from a revised -3.3% of GDP the previous quarter, reflecting stronger trade performance. Exports hovered in late 2019 in the $15 billion to $16 billion range, while the trade balance showed improvement in Q3 largely due to a $2 billion decrease in imports to $12.6 billion.The net deficit on services has settled between $8 billion and $8.5 billion over the past four quarters.The CBN has also made some sizable data revisions for Q2 2019: the trade deficit has narrowed from 2.2% to 1.3% of GDP and the current-account deficit has widened from -2.5% to -3.3%, as previously mentioned. The culprit was an increase in oil and gas imports from $2.2 billion to $3 billion.
Brazil’s general government debt, incorporating central government, states, municipalities and social security rose to 79.8 percent in August from 79.0 percent of GDP in July 2019. This was highest national debt in August since 2006, driven by combination of interest payments, higher borrowing and weaker exchange rate.The net public sector debt fell to 54.84 percent of GDP in August from 55.78 percent in July 2019 The general government’s primary deficit narrowed to R$13.45 billion in August 2019 as compared to the deficit of R$16.9 billion in August 2018. The Central Government registered a fiscal deficit of R$16.5 billion, while regional governments and state-owned enterprises registered surpluses of R$2.7 billion and R$355 million, respectively in August 2019.
The US Treasury Department’s daily statement on February 25, 2019, revealed that total outstanding public debt stands at $22.07 trillion. That's an increase of $2.12 trillion since President Donald Trump took office on January 20, 2017. The debt figure has been growing at an accelerated rate since the passage of Trump’s $1.5 trillion tax cut in December 2017 and a decision by Congress last year to increase spending on domestic and military programs.
In the 10 years since the 2008-2009 global financial crisis, aka “Great Recession,” the global debt of the non-financial sector increased by 53 percent to reach $178 trillion in the third quarter of 2018, according to the Bank for International Settlements. Global debt, which represents the outstanding credit provided by domestic banks and other institutions to households, non-financial corporations, and government, is quite simply the driver of the modern economy. Over the 2008-2018 period, each percent of GDP growth in G20 countries required, on average, 1.6 percent of debt growth.Government debt in advanced economies and the debt of non-financial corporations in emerging economies is behind this increase in post-crisis debt. This is a marked difference from the pre-crisis period surge in the household and non-financial corporations debt in advanced economies (leading ultimately to the housing market collapse and resulting global contagion). Uncontrolled debt growth of this nature may cause a myriad of problems locally and globally, however, several factors suggest that the next financial downturn will be less severe.Household debt growth in advanced economies, which was the primary reason for the 2008 financial crisis, has decelerated compared to the pre-crisis period. Whereas during the eight years before the crisis the debt of households soared 105 percent in advanced economies, in the 10 years after the crisis, household debt rose only 5 percent. In the Euro area, the debt of households even contracted by seven percent.Within the new emerging market debt, the growth in Chinese corporate debt stands out, surging almost three times since 2008. But, since Chinese companies borrow primarily from domestic institutions, it is less likely that defaults of Chinese corporate debt would lead directly to a global economic downturn.Only government debt has continued unchecked since 2008. Still, as long as investors around the world are confident in the government debt of major advanced economies, the growth of government debt is not immediately dangerous either. So, where then should there be cause for concern if in fact a crisis is inevitable, cyclical even? We're keeping close tabs on China. The structure and volume of its external debt, among other factors, may be the trigger for an economic recession in China causing far reaching economic problems globally.
The household debt balance in the United States reached a new all-time high of $13.3 trillion in the second quarter of 2018, according to the latest report from the Center for Microeconomic Data of the Federal Reserve Bank of New York. US household debt has risen continuously since 2013, now constituting 65 percent of US GDP and exceeding the 2008 pre-crisis level by nearly $475 billion. US household debt is indisputably large in absolute terms, now exceeding the GDP China, the world's second-largest economy. Yet, relative to the size of the US economy, household debt is less remarkable than it is for other economies. Australia, Canada, Denmark, Norway, Portugal, Sweden, and the United Kingdom all have higher levels of household debt as a share of GDP than the US. On a per capita basis, US household debt has also not yet reached the level of 2008 when household debt exceeded GDP per capita. This suggests that the number of new debt accounts increased more aggressively than did the origination volume. Mortgage balances also remain below their previous peak despite robust growth while auto loans reached a record value of $1.2 trillion, 74 percent higher than the 2010 level. US car sale figures also confirm an uptick in car purchases in the US, aided by historically low interest rates on auto loans.
Source: SEBI (Security Exchange Board of India) About FII A foreign institutional investor (FII) is an investor or investment fund that is from or registered in a country outside of the one in which it is currently investing. Institutional investors include hedge funds, insurance companies, pension funds and mutual funds
Nothing simpler than this to view country ranking wrt to various International Debt variables published by World Bank. Note: Select variable of choice from the drop down. Source: World Bank
A sovereign default is the failure or refusal of the government of a sovereign state to pay back its debt in full. Cessation of due payments (also euphemistically termed receivables) may either be accompanied by formal declaration (repudiation) of a government not to pay (or only partially pay) its debts, or it may be unannounced. Defaults have typically involved low-income and emerging-market economies, although recent cases include advanced-economy sovereigns. Until recently, there have been few efforts to systematically measure and aggregate the nominal value of the different types of sovereign government debt in default. This reflects a number of factors. An important reason is that there is no single internationally recognized definition of what constitutes a sovereign default. As a result, standards used by government borrowers and their creditors to report defaults, if they report at all, differ, and information on the various types of defaulted debt must be mined from different sources. To help fill this gap, the Bank of Canada’s Credit Rating Assessment Group (CRAG) has developed a comprehensive database of sovereign defaults. The database draws on previously published data sets compiled by various official and private sector sources. It combines elements of these, together with new information, to develop estimates of stocks of government obligations in default, including bonds and other marketable securities, bank loans, and official loans in default, valued in U.S. dollars, for the years 1975 to 2014 on both a country-by-country and a global basis. In addition to the country-by-country components, in most cases the database contains the following aggregate data for the period starting in 1975 to 2014: total debt in default (in nominal U.S. dollars); total debt in default by creditor type; number of sovereign governments in default; outstanding Paris Club and global general government or public debt; and global gross domestic product. For the basic definitions see the bottom of the page. For the further details on methodology please consult the Bank of Canada's technical report. Source: Database of Sovereign Defaults, 2015
US Whitehouse, Office of Management and Budget provides data on budget receipts, outlays, surpluses or deficits, Federal debt, and Federal employment over an extended time period, generally from 1940 or earlier to 2014 and estimates up to 2019. Source: The White House
US Federal Debt | US Federal Debt as % of GDP
US Federal Debt | US Federal Debt as % of GDP
The US Federal Debt (also referred to as The Public Debt or The Government Debt) is the amount owed by the federal government of the United States at any time in the past and not yet repaid. America has the largest debt burden in the world, which is estimated to be $18,472 billion by the end of 2015. Generally, there are two components of gross federal debt: debt held by the public and Ddbt held by government accounts. In 2007 the share of US federal debt held by the public was 56% only, whereas in 2014 this component constituted approximately 72% of the total debt burden. According to the latest forecasts, US Federal Debt is going to reach $27 trillion by 2025, with the proportion of debt held by the public constituting 78,7% of 2025 US GDP! On this interactive dashboard you can observe the history of US Federal Debt, its structure and the latest projections of future dynamics. In order to explore the history of various debt indicators, please select the indicator of your interest from the table at the bottom of the page Sources: US Whitehouse, Office of Management and Budget, Federal Debt, 1940-2020, United States Congressional Budget Office: Budget Data and Projections, March 2015
The United States’ economic performance compared to other countries is strong in terms of GDP per capita as one might would guess; however, tax revenue as a percent of GDP is much lower in relation to the other countries studied.