OECD public debt climbs to $61 trillion, raising risks for major economies

The world’s largest economies are facing a rapidly growing mountain of debt as they fund higher spending while tax revenue growth remains limited and interest rates stay elevated. The OECD said public debt across its member states exceeded $60 trillion in 2025, creating new risks for fiscal stability.

OECD countries raised about $17 trillion from financial markets last year. Their total outstanding debt stood near $61 trillion at the end of 2025. Debt remained at roughly 83% of GDP, but the organization expects that ratio to reach 85% in 2026 as governments borrow another $1 trillion internationally.

The current debt-to-GDP ratio is almost 40 percentage points higher than in 2007, before the global financial crisis. The burden is becoming more concerning as global growth is expected to remain below 3%, while geopolitical tensions and higher energy prices fuel inflationary pressure.

The OECD said government bond markets face growing pressure from persistent budget deficits, more expensive financing and rising investment needs. The effects of the sharp interest-rate increases that began in 2022 continue to push up borrowing costs. Continued bond issuance and weaker demand for long-term securities are also driving yields higher.

Governments have responded by reducing long-term bond issuance and relying more heavily on short-term borrowing. The share of government debt issued with a 10-year maturity fell in 2025 to its lowest level since 2009, while treasury bills accounted for 48% of total OECD government borrowing. That strategy can provide temporary flexibility but raises refinancing risk, because governments must return to markets more often and face greater exposure to interest-rate changes.

OECD countries’ public-debt refinancing needs reached a record $13.5 trillion at the end of 2025, about 80% of their total gross borrowing. The figure is expected to rise by another $1 trillion in 2026, to its highest level since the pandemic. Governments must also finance higher defense spending, artificial-intelligence infrastructure and the needs of aging populations, creating a cycle in which more debt is refinanced at higher costs.