GLOBAL MACRO RISK & FINANCIAL RESILIENCE
See how debt and refinancing rates can change the U.S. interest burden
Model how a changing refinancing rate, new borrowing and the pace of debt rollover can affect the U.S. government’s interest burden over time.
No loginTransparent mathOfficial data reference
YOUR SCENARIO
Modeled debt-service path
Loading the reference data…
RATE SENSITIVITY
Modeled annual interest cost by year
Compare the selected refinancing rate with a mechanical 1 percentage-point lower and higher path. These are sensitivity bands, not forecasts.
1 pp lowerSelected rate1 pp higher
| Scenario | New/refi rate | Final-year interest | Cumulative interest | Final debt | Vs selected final-year interest |
|---|
DETAIL
Year-by-year selected-rate path
Exact values remain available even though the dense table is collapsed by default.
Show year-by-year debt and interest detail
| Year | Legacy debt remaining | Original debt refinanced | Debt at new rate before additions | Modeled interest | Primary deficit | Closing debt | Effective modeled rate |
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HOW TO READ IT
What drives the result?
The model separates the original starting debt into a legacy-rate portion and a portion that has refinanced at the selected new rate. Each year, a fixed tranche of the original debt moves to the selected refinancing rate. The primary deficit and modeled interest cost are then added to debt at year-end and begin accruing interest in the following modeled year.
Year t modeled interest(legacy debt × existing rate) + (new/refinanced debt × selected rate)
The model deliberately uses a transparent beginning-of-year interest / year-end borrowing convention. Real Treasury issuance, coupons, bills, TIPS adjustments and maturity schedules are more complex.
Debt held by the public vs total public debt
Debt held by the public is Treasury debt held outside federal government accounts. Total Public Debt Outstanding also includes intragovernmental holdings. Carrowmont defaults to debt held by the public because that measure is commonly used in budget and economic analysis.
Primary deficit vs total deficit
The primary deficit excludes net interest. Asking for a primary deficit prevents the model from adding interest twice: the model calculates interest separately and then adds both primary deficit and modeled interest to year-end debt.
Modeled interest vs official net interest
Carrowmont’s modeled interest cost is a simplified scenario output. It is not Treasury-reported gross interest expense and it is not CBO net interest outlays, which use official budget-accounting definitions and offsets.
Why interest can compound the burden
When deficits and interest costs are financed with additional borrowing, the debt stock can grow. In later years that larger stock can itself create more interest cost under the model.
GLOBAL CONTEXT
How could U.S. debt-service conditions matter beyond the U.S.?
Higher or more volatile Treasury borrowing costs can interact with global bond yields, dollar funding conditions, investor risk appetite and capital flows. Those channels may influence borrowing costs and asset prices elsewhere, but the direction and size of any effect depend on many forces.
For a separate view of how fiscal stress can interact with real yields, the dollar, inflation and safe-haven demand, use the Gold Under Macro Stress Explorer.
To follow fiscal stress into Treasury yields, the U.S. dollar and other market channels without treating any outcome as guaranteed, use the Market Chain Reaction Explorer.
For India, relevant transmission channels can include global yields, the U.S. dollar, capital flows, the rupee, imported energy costs and domestic financial conditions. This calculator does not predict any of those outcomes.
FAQ
Common questions
What is debt held by the public?
It is federal debt held by investors and entities outside federal government accounts, subject to Treasury definitions. The figure includes Treasury securities held by individuals, institutions, governments and Federal Reserve Banks.
How is total public debt different?
Total Public Debt Outstanding equals debt held by the public plus intragovernmental holdings.
Why doesn’t a higher Treasury yield immediately apply to all U.S. debt?
Outstanding securities keep their existing terms until they mature or otherwise roll over. New market rates affect the debt stock gradually as borrowing is issued or refinanced.
What is the average interest rate on federal debt?
It is an average borrowing-cost concept across the debt stock, not one current Treasury yield. CBO estimated the average interest rate on debt held by the public at 3.4% in 2026.
Why does this calculator use a primary deficit?
Because primary deficit excludes net interest. The model calculates interest separately, avoiding double counting.
Is modeled interest cost the same as CBO net interest outlays?
No. This is a simplified deterministic model. CBO net interest is an official budget measure with specific accounting treatment and offsets.
Does this calculator predict a U.S. default?
No. It is an educational sensitivity model, not a default, market or Treasury-yield forecast.
Does the Federal Reserve directly set the interest rate on all Treasury debt?
No. The Federal Reserve sets a target range for the federal funds rate. Treasury securities are issued across maturities and their market yields reflect many forces.
Why can interest expense keep rising even if rates stop rising?
If existing lower-rate debt continues to mature into a higher-rate environment, the average cost can keep moving upward. Additional borrowing can also expand the debt stock.
How could U.S. debt-service conditions affect India?
Possible channels include global yields, the dollar, capital flows, the rupee, imported energy costs and domestic financing conditions. The calculator does not predict direction or magnitude.
Why are all calculations in USD?
The tool models U.S. federal debt. It does not perform exchange-rate conversion or relabel dollar debt in another currency.
Is this investment advice?
No. The tool is educational scenario analysis and does not recommend securities, portfolios or market trades.
SOURCES & LIMITATIONS
Official data where facts matter; explicit assumptions where scenarios begin
The starting debt is a validated U.S. Treasury reference snapshot. The page never calls the Treasury API in your browser; the bundled reference is updated through a protected maintenance workflow.
Limitation: real Treasury refinancing does not occur in equal annual tranches. The model is intentionally simplified so users can understand the mechanics rather than mistake complexity for precision.
- U.S. Treasury FiscalData — Debt to the Penny
- U.S. Treasury FiscalData — Average Interest Rates
- U.S. Treasury FiscalData — Interest Expense
- U.S. Treasury FiscalData — Monthly Statement of the Public Debt
- U.S. Treasury — Daily Treasury Par Yield Curve Rates
- Congressional Budget Office — Budget and Economic Outlook: 2026 to 2036
UNDERSTAND THE MECHANICSWhy U.S. debt interest costs matter→
Read how debt size, average rates, maturities and refinancing interact before changing the calculator assumptions.