The US faces a Liz Truss-style market shock if the government ignores the country\u2019s ballooning federal debt, the head of Congress\u2019s independent fiscal watchdog has warned.<\/p>\n
Phillip Swagel, director of the Congressional Budget Office, said the mounting US fiscal burden was on an \u201cunprecedented\u201d trajectory, risking a crisis of the kind that sparked a run on the pound and the collapse of Truss\u2019s government in the UK in 2022.<\/p>\n
\u201cThe danger, of course, is what the UK faced with former prime minister Truss, where policymakers tried to take an action, and then there\u2019s a market reaction to that action,\u201d Swagel said in an interview with the Financial Times.<\/p>\n
The US was \u201cnot there yet\u201d, he said, but as higher interest rates raise the cost of paying its creditors to $1tn in 2026, bond markets could \u201csnap back\u201d.<\/p>\n
Read it all<\/a>.<\/p>\n FT Exclusive: US debt is on an 'unprecedented' trajectory that could lead to a Liz Truss-style market shock, the head of Congress\u2019s independent fiscal watchdog has warned https:\/\/t.co\/JLiKKeQE9z<\/a> pic.twitter.com\/ljX3OpInL1<\/a><\/p>\n — Financial Times (@FT) March 26, 2024<\/a><\/p><\/blockquote>\n \n