US Federal Debt Still Growing, Unsustainable, Will Reach 106% In 10 Years - Report

WASHINGTON (UrduPoint News / Sputnik - 07th June, 2023) The growing debt of the United States Federal Government is continuing to grow and will become unsustainable if it is allowed to continue expanding at its current rate, the Government Accountability Office (GAO) warned in a new report.

"The federal government faces an unsustainable long-term fiscal future," the report stated on Tuesday. "At the end of fiscal year (FY) 2022, debt held by the public was about 97% of gross domestic product (GDP)."

The debt held by the public is projected to grow at a faster pace than the size of the US economy and on current trends, it will reach its historical high of 106%� of GDP within 10 years, then continue to grow at an increasing pace," the GAO warned.

"The fiscal outlook faces additional risks posed by delays in raising or suspending the debt limit ...These delays could disrupt financial markets, and investors may require higher interest rates to hedge against increased risks, which could increase borrowing costs," the report cautioned.

Failure to raise or suspend the debt limit in time to prevent a federal government default would have devastating effects on the US domestic economy, on global economies and on the American public, the GAO advised.