Global Economy at Risk as US Treasury Yields Surge: Finance Minister Sri Mulyani’s Warning

Jakarta, CNBC Indonesia – Finance Minister Sri Mulyani warned of an increase in yield no result The US Treasury could create new uncertainty in the global economy.

Sri Mulyani explained that the spike in US Treasury yields would increase the interest burden of the United States government’s (US.

This situation could be a big problem because there is a risk of stalling debt talks between the Republican Party and the Democratic Party.

Mentioning interpretive, The 10-year US Treasury tenor yield reached 4.7% today, Friday (4/26/2024). This position is the highest since 1 November 2023 or the last five months.

The increase in yield indicates that dealers are selling debt securities or US Treasuries, so the government has to provide more “sweetener” in the form of an increase in yield.

Product trends will This has had the effect of increasing the US government debt burden which is already increasing.

The cost of paying interest on US government debt has reached US$ 870 billion in 2024 or approximately Rp. 14,170.56 billion (exchange rate US $ = Rp. 16,220). Debt interest has jumped 132% in the past five years.

This increase in debt interest is due to the continued increase in US government debt.

“If the two parties do not agree at any time, it will threaten the implementation of the US APBN. This situation will cause bad opinion. So the global environmental situation will cause unstoppable economic projections,” Sri Mulyani said.

As is known, the administration of US President Joe Biden is facing a debt ceiling crisis in April-June 2023.

The US government debt ceiling crisis is a major threat to global financial markets.
The crisis began with the Republicans who control Congress asking Biden to reduce spending. However, Biden chose to cut the deficit by raising taxes on the wealthy.

The debt ceiling, set by Congress, represents the maximum amount the federal government can borrow to pay off its debt.

The US debt ceiling was first introduced in 1917. The US then adopted regulations regardingdebt ceilingPublic Debt Acts of 1939 and updated in 1941.

Every time the US government’s debt ceiling hits a record high, Congressional approval is required.

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