US Treasury debt (the national debt) recently crossed the $40 trillion mark for the first time.

 US Treasury debt (the national debt) recently crossed the $40 trillion mark for the first time. As of August 19, 2026, total public debt outstanding stood at approximately $40.01 trillion.

Breakdown of the Debt

The total consists of two main categories:

Category	Amount (approx., Aug 19, 2026)	Share of Total	Description
Debt Held by the Public	$32.26 trillion	~81%	Debt owed to outside entities: individuals, mutual funds, banks, pension funds, state/local governments, the Federal Reserve, and foreign investors/governments. This is the primary measure of fiscal burden used by analysts and the CBO.
Intragovernmental Holdings	$7.75 trillion	~19%	Debt the government owes itself (mainly Government Account Series securities held by trust funds such as Social Security and Medicare). These are internal accounting entries and do not represent net claims on the economy in the same way.

Total Public Debt Outstanding = Debt Held by the Public + Intragovernmental Holdings.

Debt held by the public is roughly 100% of GDP. Gross federal debt (the $40 trillion figure) is around 124–126% of GDP.

Recent Trends and Context

• The debt more than doubled in the past decade (it was about $19.4 trillion in 2016).
• It crossed $30 trillion roughly 4.5 years earlier and hit $40 trillion in mid-August 2026.
• The federal government is on track to borrow more than $2 trillion this year. The 12-month rolling deficit has been running near $1.8–1.9 trillion, with a particularly large monthly deficit in July 2026 ($432 billion).

Who Holds the Debt?

• Domestic holders (the majority of publicly held debt) include the Federal Reserve (which holds over $4.5 trillion in Treasuries), mutual funds, banks, insurance companies, pension funds, and individual investors.
• Foreign holders owned about $9.3 trillion of Treasuries as of June 2026 (roughly 29% of debt held by the public). Top holders included:
  • Japan: ~$1.12 trillion
  • United Kingdom: ~$0.94 trillion
  • China (Mainland): ~$0.63 trillion
  • Belgium, Canada, Cayman Islands, Luxembourg, and others.

Foreign official holdings (central banks and governments) account for a significant portion of the foreign total.

Interest Costs

Interest expense has risen sharply with higher rates and the growing debt stock. Net interest payments are now over $1 trillion annually and rank among the largest federal spending categories (trailing only major entitlement programs like Social Security and Medicare in some measures). Interest costs have roughly doubled since 2022.

Policy Response and Market Context

On August 19–20, 2026, the Treasury announced it would at least double the size of its liquidity-support buybacks of longer-dated nominal Treasuries (10- to 30-year sector) to a minimum of $4 billion per operation, starting September 9. Treasury Secretary Scott Bessent indicated the size could go even higher. The move aimed to support liquidity in the long end of the curve after yields had climbed (30-year yields briefly hit multi-decade highs). The initial market reaction included a temporary drop in long yields, but much of that relief reversed the next day amid ongoing concerns about deficits, inflation, and debt levels.

Longer-Term Outlook (CBO Projections, February 2026 baseline)

Under current law:

• Debt held by the public is projected to rise from ~100% of GDP today to 120% of GDP by 2036 (and higher in later decades).
• Gross debt is expected to grow substantially (CBO has projected it reaching the mid-$60 trillion range by the mid-2030s in some earlier estimates).
• Deficits are projected to average around 6% of GDP over the coming decade, driven largely by mandatory spending (entitlements) and net interest.
• Net interest costs are forecast to roughly double to about $2.1 trillion by 2036.

Key Takeaways

The $40 trillion milestone highlights the rapid growth of US federal borrowing, driven by persistent large deficits, pandemic-era stimulus, tax policy, rising entitlement costs, higher interest rates, and other factors (including recent geopolitical and policy developments). Debt held by the public near 100% of GDP is high by historical peacetime standards (the post-WWII peak was about 106%). Rising interest costs are crowding out other spending and making the fiscal trajectory more challenging, which has contributed to higher long-term Treasury yields and market volatility.

Official daily data is available from the U.S. Treasury’s Fiscal Data site (“Debt to the Penny”). Projections come primarily from the Congressional Budget Office.