**What is the projected US federal deficit for fiscal year 2026?**

The US federal deficit is projected at $2 trillion in FY2026, up from $1.7 trillion in FY2025. The Office of Management and Budget projects $2.065 trillion, the CBO's February 2026 baseline projects $1.853 trillion, and primary dealers surveyed by Treasury put the median at $1.950 trillion. All three figures are roughly double the 3%-of-GDP target backed by Congress.

**How fast is the US national debt growing?**

As of January 7, 2026, the national debt stood at $38.43 trillion and was growing at $8.03 billion per day — or about $92,912 per second. Over the prior year, the debt increased by $2.25 trillion. Over the prior five years, it rose by $10.73 trillion, according to the Joint Economic Committee's Monthly Debt Update.

**What is House Resolution 981?**

House Resolution 981 is a bipartisan resolution pending in Congress that would set a fiscal target of reducing the federal deficit to 3% of GDP or less by 2030. The current FY2026 deficit is projected at roughly double that target. The measure has drawn support from members on both sides of the aisle.

**What is the Penn Wharton Budget Model's "outer bound" for US debt?**

The Penn Wharton Budget Model defines the "outer bound" as more than 210% of GDP — the point beyond which no feasible tax on labor income can cover interest payments at investor-acceptable returns. The US debt-to-GDP ratio is about 100% today. PWBM estimates a 25% chance of hitting the outer bound within 14 years under historical healthcare cost growth rates.

**What did Tax Foundation chief economist Will McBride say about the deficit?**

Will McBride said Congress and the administration are "still ignoring the dangers of an unsustainable debt trajectory and actively making it worse rather than addressing it." He added that "the effect is to make a crisis more likely to happen sooner rather than later." McBride made the comments to The Center Square in response to the FY2026 deficit projections.

US Deficit Hits $2 Trillion in FY2026

By iCharles News · June 11, 2026

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The FY2026 federal deficit is on track for $2 trillion — up from $1.7 trillion last year and double the bipartisan 3%-of-GDP target backed by Congress.

What is the projected US deficit for FY2026?

The US federal deficit is projected to hit $2 trillion in fiscal year 2026, up from $1.7 trillion last year.

That figure is double the 3%-of-GDP target that has bipartisan support in Congress, according to Treasury's quarterly refunding documents as reported by The Center Square.

Three separate forecasts all point in the same direction, though the exact numbers differ slightly.

Source	Deficit Projection
Office of Management and Budget	$2.065 trillion
Primary dealers surveyed by Treasury (median)	$1.950 trillion
Congressional Budget Office (February 2026 baseline)	$1.853 trillion

The projections come from Treasury's quarterly refunding presentation to the Treasury Borrowing Advisory Committee — a panel of bond market participants that advises the department on debt management.

How big is the national debt right now?

As of January 7, 2026, total gross national debt stood at $38.43 trillion, per the Joint Economic Committee's Monthly Debt Update. That is $2.25 trillion higher than one year earlier and $10.73 trillion higher than five years ago.

The pace of growth breaks down as follows:

$8.03 billion added per day
$334.48 million per hour
$5.57 million per minute
$92,912 per second

That annual increase amounts to $6,624 per person or $16,719 per household. Total gross national debt works out to $112,966 per person or $285,127 per household.

What are interest costs doing to the budget?

The average interest rate on total marketable national debt reached 3.362% as of December 2025. Five years ago it was 1.552%. Net interest has nearly tripled over the last five years.

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The Congressional Budget Office forecasts net interest as a share of federal outlays at:

13.85% in FY2026
14.11% in FY2027
14.52% in FY2028

Interest paid to trust funds over the past 12 months totaled $261.43 billion, averaging $21.79 billion per month.

What do experts say about the trajectory?

Will McBride, chief economist at the Tax Foundation, did not mince words. "It indicates Congress and the administration are still ignoring the dangers of an unsustainable debt trajectory and actively making it worse rather than addressing it," McBride told The Center Square. "The effect is to make a crisis more likely to happen sooner rather than later."

Here's what we know so far: no single institution — not the OMB, not the CBO, not primary dealers — projects the deficit coming in below $1.85 trillion this fiscal year.

Is there a legislative fix in the works?

A bipartisan resolution, House Resolution 981, is pending in Congress. It would set a fiscal target of reducing the federal deficit to 3% of GDP or less by 2030. The measure has drawn support from members on both sides of the aisle, according to reporting via scottpeters.house.gov.

The current deficit is running at roughly double that 3%-of-GDP target.

What is the Penn Wharton "outer bound" for US debt?

The Penn Wharton Budget Model (PWBM) is a fiscal analysis tool that estimates the point at which US debt becomes mathematically unsustainable. PWBM has identified an "outer bound" of more than 210% of GDP. Above that threshold, no feasible tax on labor income can finance interest payments at returns acceptable to investors, Fortune reported.

The current debt-to-GDP ratio is about 100%. The CBO projects it hitting 175% by 2056.

PWBM estimates the US has between 19 and 25 years before reaching the outer bound, depending on healthcare cost growth. Under historical healthcare cost growth rates, PWBM puts a 25% probability on hitting that threshold within 14 years.

Fixing federal finances before that point would require a permanent tax hike of about 15 percentage points on all labor income, with no caps exempting higher earners, PWBM said.

What risks does the bond market pose?

Treasury has seen a string of weaker bond auctions recently, with tepid demand pushing yields higher.

Japanese investors — the largest foreign holders of US debt, holding about $1 trillion in Treasuries — are showing signs of repatriating capital as the Bank of Japan hikes rates and Japanese government bond yields become more attractive.

Mark Dowding, chief investment officer at BlueBay, told the Financial Times: "The new money that's being put to work won't be put to work overseas. It won't be going into U.S. Treasuries. It will be going into those domestic allocations."

PWBM also warned that bond markets unravel faster "when investors believe that the government will not restore fiscal sustainability."

How does this connect to inflation?

The Peterson Institute has warned that inflation could exceed 4% by year-end, partly because the fiscal deficit could top 7% of GDP. Sustained tariffs that reduce the inflow of international capital could shorten US fiscal leeway by two to four years, PWBM added.

These fiscal pressures matter for builders and founders tracking AI entry-level jobs shrinking and broader economic conditions. Higher deficits feed into higher interest rates, which affect capital costs across every sector — from Bezos's Prometheus AI to Coinbase's agentic market for AI agents.

Even Anthropic's IPO trajectory sits inside a macro environment shaped by these borrowing costs.

The JEC's debt dashboard projects the US will reach $39 trillion in total gross national debt by approximately April 5, 2026, assuming the average daily growth rate of the past three years continues.

Frequently asked questions

**What is the projected US federal deficit for fiscal year 2026?**: The US federal deficit is projected at $2 trillion in FY2026, up from $1.7 trillion in FY2025. The Office of Management and Budget projects $2.065 trillion, the CBO's February 2026 baseline projects $1.853 trillion, and primary dealers surveyed by Treasury put the median at $1.950 trillion. All three figures are roughly double the 3%-of-GDP target backed by Congress.
**How fast is the US national debt growing?**: As of January 7, 2026, the national debt stood at $38.43 trillion and was growing at $8.03 billion per day — or about $92,912 per second. Over the prior year, the debt increased by $2.25 trillion. Over the prior five years, it rose by $10.73 trillion, according to the Joint Economic Committee's Monthly Debt Update.
**What is House Resolution 981?**: House Resolution 981 is a bipartisan resolution pending in Congress that would set a fiscal target of reducing the federal deficit to 3% of GDP or less by 2030. The current FY2026 deficit is projected at roughly double that target. The measure has drawn support from members on both sides of the aisle.
**What is the Penn Wharton Budget Model's "outer bound" for US debt?**: The Penn Wharton Budget Model defines the "outer bound" as more than 210% of GDP — the point beyond which no feasible tax on labor income can cover interest payments at investor-acceptable returns. The US debt-to-GDP ratio is about 100% today. PWBM estimates a 25% chance of hitting the outer bound within 14 years under historical healthcare cost growth rates.
**What did Tax Foundation chief economist Will McBride say about the deficit?**: Will McBride said Congress and the administration are "still ignoring the dangers of an unsustainable debt trajectory and actively making it worse rather than addressing it." He added that "the effect is to make a crisis more likely to happen sooner rather than later." McBride made the comments to The Center Square in response to the FY2026 deficit projections.

Sources

according to Treasury's quarterly refunding documents scottpeters.house.gov
per the Joint Economic Committee's Monthly Debt Update jec.senate.gov
Fortune reported fortune.com

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