According to Jinshi, Ray Dalio, founder of Bridgewater Associates, said he was concerned about weak demand for U.S. Treasuries and difficulty matching supply, especially as international buyers are concerned about the U.S. debt situation and possible sanctions. He added that if the United States imposes sanctions on more countries, it could reduce international demand for U.S. Treasuries.
The Congressional Budget Office predicts that by the end of this decade, the U.S. debt-to-GDP ratio will rise to 106%, the highest level since World War II, and will continue to rise. The director of the budget office warned that ignoring the federal deficit could trigger a crisis similar to the one that led to a run on the British pound and the collapse of the Truss government in 2022.
Federal Reserve Chairman Jay Powell has said that "the United States is on an unsustainable fiscal path" when it comes to debt. Borrowing costs have climbed this year, with the 10-year Treasury yield jumping from 3.88% to 4.35% as investors sharply lowered their expectations for rate cuts.
