When the US Government Is the Only Borrower It’s No Wonder Yields Rising
19th October 2023
The US government is the only sector to have notably borrowed on a net basis over the last five years. The market sees that as inflationary, driving yields higher.
The pandemic saw an increase in the borrowing of all sectors. But it was the government that saw the biggest rise in GDP terms, and it is the government whose debt is still considerably higher than it was before the pandemic – the debt-to-GDP ratio is up 16 percentage points over the last five years.