The U.S. national debt will again rise by more than $1.9 trillion in FY2026, according to the Congressional Budget Office, having risen by $1.35 trillion (over FY2025) in the first nine months of the fiscal year, through June. This has resulted in the Treasury paying out interest on that $39.5 trillion debt, at the rate of $24 billion/week. That interest on the debt, totaling about $850 billion for October 2025 through June 2026, was the largest category of U.S. national budget spending, and also grew the fastest—by $100 billion. By comparison, Social Security spending grew by $62 billion; Medicare by $58 billion, and Medicaid by $49 billion over the previous Fiscal Year.
The largest spending driver of the Treasury market, is the planned Pentagon budget, rising by more than 40% to $1.5 trillion, as overall spending is rising by only about 1.0%. That Pentagon budget is pushing interest rates slowly but surely upwards, towards 5% or more for all longer-term Treasury bonds.
