The U.S. Treasury reported that debt-service spending hit a record $1.36 trillion for fiscal year 2026. The fiscal deficit expanded to $1.99 trillion as government spending reached $7.40 trillion, exceeding record tax receipts of $5.40 trillion. This increase in borrowing has added pressure to long-term Treasury bond prices, with the iShares 20+ Year Treasury Bond ETF losing 34% over five years. Analysts warn that continued deficits could further strain the bond market and impact income investors.
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