When Bill Clinton took office, US gross federal debt stood at about 63% of GDP. The latest available reading is above 122%, according to figures shared in September 2026 by Charles-Henry Monchau, CIO at Syz Group. Wars, tax cuts, financial crises, a pandemic and rising entitlement spending all contributed. Now interest costs add to the bill: the Congressional Budget Office projects more than USD 1 trillion in net interest spending in 2026.
Three paths, one preferred
The options to regain control are well known: grow faster, address long-term costs and stop financing new promises with debt. Growth is the most appealing route, and AI-driven productivity is the great hope. Whether it arrives fast enough to outpace the interest bill is an open question.
Why it matters for Mexico
- Global rates. Heavy Treasury issuance keeps pressure on long-term US yields, the reference for every emerging-market borrower.
- Spreads and the peso. Periods of fiscal stress in the US tend to raise risk premiums and volatility for Mexican assets.
- Funding strategy. Companies should favor peso funding that matches their revenue, longer tenors when available and covenants that tolerate rate volatility.
For borrowers, the practical takeaway is simple: structure financing for a world where capital stays expensive for longer.
Sources: Congressional Budget Office; Charles-Henry Monchau, Syz Group (September 2026).
This content is for informational purposes only and does not constitute investment advice or an offer of securities.
