Story perspectives

Treasury Yields Hit 5.04% as Debt Risks Mount

By Drooid · Oct 4, 2026, 2:44 PM UTC · How we work

Summary

Story summary

U.S. Treasury yields climbed to 5.04%, the highest level since 2007.
Gross national debt exceeded $40 trillion in August, after $38 trillion in October 2025.
Fiscal 2026 closed with a $2 trillion deficit and $32.3 trillion publicly held debt.
Net interest payments hit $970 billion in FY2025, exceeding defense spending.
Scope Ratings left the U.S. sovereign rating at AA-, warning debt-service could push debt to 160% of GDP by 2036.

History

Historical Context

The 2008 financial crisis, culminating in September 2008, forced U.S. Treasury yields to surge above 5 % for the first time since 2000. Federal Reserve Chairman Ben Bernanke cut the federal funds rate to 0.25 % while the Treasury issued $1.7 trillion in new debt, and Moody’s downgraded several banks. Today's 2026 yield climb to 5.04 % and $40 trillion debt echo that 2008 debt-service strain, prompting rating agency Scope Ratings to downgrade the sovereign rating to AA-. If fiscal deficits persist, the Congressional Budget Office warns debt could exceed 160 % of GDP by 2036, mirroring the prolonged fiscal tightening after the 2008 crisis.

1 of 2

Story summary

U.S. Treasury yields climbed to 5.04%, the highest level since 2007.
Gross national debt exceeded $40 trillion in August, after $38 trillion in October 2025.
Fiscal 2026 closed with a $2 trillion deficit and $32.3 trillion publicly held debt.
Net interest payments hit $970 billion in FY2025, exceeding defense spending.
Scope Ratings left the U.S. sovereign rating at AA-, warning debt-service could push debt to 160% of GDP by 2036.

1 / 2