CBO: US Treasury Borrowing Pace Reaches $155bn a Month

Updated: July 11, 2026

The latest CBO US Treasury borrowing pace figures show that the federal government accumulated a budget deficit of approximately $1.4 trillion during the first nine months of fiscal year 2026.

That works out at roughly $153 billion per month using the Congressional Budget Office’s unrounded $1.373 trillion estimate, or approximately $155 billion when calculated from the rounded headline figure. The pace has renewed concerns about how much debt the Treasury must issue and how rapidly interest costs are consuming federal revenue. 

However, the monthly figure needs careful interpretation. It represents the average federal budget shortfall, not necessarily the precise amount of marketable debt sold by the Treasury each month. 

What Does the CBO’s US Treasury Borrowing Pace Figure Mean?

The Congressional Budget Office estimated that the federal government collected $4.151 trillion and spent $5.523 trillion between October 2025 and June 2026. The resulting deficit was $1.373 trillion, $35 billion larger than the shortfall recorded during the same nine months of the previous fiscal year.  

Dividing that deficit across nine months produces an average shortfall of about $152.6 billion per month. Some reports have rounded the deficit to $1.4 trillion and described the pace as approximately $155 billion per month. 

The distinction between a budget deficit and Treasury borrowing is important. A deficit measures the difference between federal receipts and outlays. Treasury’s actual net marketable borrowing can differ because it must also manage its cash balance, securities held by government accounts, Federal Reserve redemptions and other financing adjustments.

Therefore, the $155 billion figure is best understood as an indication of the government’s average fiscal shortfall rather than a record of identical monthly Treasury auctions. 

In June alone, the government recorded an estimated deficit of $126 billion, compared with a reported $27 billion surplus in June 2025. Part of that difference resulted from federal payments being shifted between months because June 1, 2025 fell on a weekend.

After adjusting for that timing effect, CBO estimated that the June 2026 deficit was $56 billion larger than the comparable figure for the previous year.  

Why Is the Federal Government Borrowing So Much?

Federal spending continued to grow faster than revenue during the first nine months of fiscal year 2026. 

Receipts increased by $142 billion, or 4%, from the comparable period in 2025. Individual income and payroll tax collections increased by a combined $169 billion, while customs-duty collections were $55 billion higher. Corporate income-tax receipts, however, declined by $86 billion.  

CBO reported that around $70 billion in tariff refunds was paid during May and June following a February 2026 Supreme Court decision affecting certain tariffs. Those repayments contributed to a sharp reduction in net customs-duty collections toward the end of the nine-month period.  

Meanwhile, federal outlays increased by $178 billion, or 3%. Several of the largest increases came from mandatory programmes: 

Net interest expenditure reached $857 billion in only nine months, up 13% from $759 billion during the comparable period. CBO attributed the increase to a larger stock of federal debt and higher long-term interest rates, although lower short-term rates offset part of the rise.

This creates a difficult fiscal cycle. Existing debt generates larger interest bills, those bills increase annual spending, and the government may then need to borrow more to finance the resulting deficit. 

How Much Does the US Treasury Expect to Borrow Next?

Treasury’s own financing projections show that marketable borrowing is expected to accelerate during the final quarter of the fiscal year. 

The department estimated that it would borrow $189 billion in privately held net marketable debt during April through June 2026. That was $79 billion higher than the estimate released in February, mainly because projected net cash flows were lower than previously expected.

For the July-to-September quarter, Treasury estimated net marketable borrowing of $671 billion, assuming that its operating cash balance finishes September at $950 billion. Treasury had previously borrowed $577 billion during the January-to-March quarter.

These quarterly figures demonstrate why deficit averages and Treasury borrowing estimates should not be treated as interchangeable. The Treasury may issue considerably more debt during one quarter to rebuild its cash balance, meet seasonal expenditure or prepare for large payments. 

In its May quarterly refunding statement, Treasury said it expected to maintain the sizes of nominal coupon and floating-rate note auctions for at least the next several quarters. Short-term financing requirements would instead be managed partly through changes to Treasury bill auctions and cash-management bills. The department also anticipated gradually increasing bill auction sizes across the maturity curve during July.  

Why Does the Borrowing Pace Matter to Investors and Consumers?

A high volume of Treasury issuance does not automatically cause a bond-market crisis. US government securities remain central to global financial markets and are widely used as reserve assets, collateral and low-credit-risk investments. 

Nevertheless, a continuously expanding supply of debt can require higher yields to attract sufficient demand, particularly when inflation expectations, economic growth or competing investment opportunities are also pushing market rates upward. 

CBO has warned that large and growing federal debt can raise long-term interest rates, reduce economic growth and leave policymakers with less fiscal capacity to respond to recessions, wars or other emergencies. Greater interest payments to overseas holders of US debt can also reduce national income.  

Higher Treasury yields can influence borrowing costs throughout the economy because government yields are used as benchmarks for mortgages, business loans, corporate bonds and other forms of credit. 

The effect is not mechanical, however. Treasury yields are also affected by Federal Reserve policy, inflation, economic growth, international capital flows and investor demand for safe assets. 

What Does the CBO Project for US Debt?

The current borrowing pace is part of a much longer fiscal trend. CBO projects a $1.9 trillion federal deficit for the full 2026 fiscal year, equivalent to 5.8% of gross domestic product. Under its current-law baseline, the annual deficit rises to $3.1 trillion by 2036. 

Debt held by the public is projected to increase from 101% of GDP in 2026 to 120% of GDP in 2036, exceeding the previous post-Second World War record. Rising Social Security, Medicare and net interest expenditure are expected to be major contributors to that deterioration.  

These are projections rather than guaranteed outcomes. Changes in tax policy, spending legislation, tariffs, inflation, economic growth and interest rates could materially alter the figures. 

What Happens Next?

The next major update will come from the Treasury Department’s financing estimates, scheduled for August 3, 2026, followed by its quarterly refunding announcement on August 5. Those releases will show whether the projected $671 billion July-to-September borrowing requirement has changed.

CBO’s July monthly budget review is scheduled for August 10. It will provide another indication of whether revenue growth is keeping pace with federal expenditure as fiscal year 2026 approaches its September 30 conclusion.  

For now, the latest data indicates that the federal government continues to run a deficit averaging approximately $153 billion to $155 billion a month, while rising interest costs are making the underlying fiscal position increasingly difficult to stabilise.