By Karin Strohecker<\/p>\n
LONDON, May 6 (Reuters) – Investors are showing signs of diversifying away from U.S. Treasuries as global debt levels hit a record of nearly $353 trillion by end-March, a report \u200cby the Institute of International Finance published on Wednesday found.<\/p>\n
IIF’s quarterly Global Debt Monitor said that \u200cstrengthening international demand for Japanese and European government bonds contrasted with broadly stable demand for U.S. Treasuries since the start of \u200bthe year.<\/p>\n
“This highlights that there are some efforts by international investors diversifying away from U.S. Treasuries,” Emre Tiftik, director at the IIF for Global Markets and Policy said during a webinar to discuss the report.<\/p>\n
While there was “no immediate risk” in the $30 trillion U.S. Treasury market, long-term projections suggested U.S. government debt increasingly looked to be on \u200can “unsustainable path”, he said, whereas debt ratios \u2060for the euro zone and Japan were now edging down.<\/p>\n
Under current policies, the U.S. debt-to-GDP ratio is expected to continue rising, the report said, while U.S. corporate bond \u2060markets continued to boom, supported by AI-related issuance and strong overseas inflows.<\/p>\n
RISING DEBT LEVELS<\/p>\n
Washington’s borrowing push was one of the main drivers for global debt to rise by over $4.4 trillion in the first quarter, the fastest increase since \u200bmid\u20112025 \u200band the fifth straight quarterly increase, the IIF report said.<\/p>\n
Tiftik \u200bsaid the rise in U.S. debt had \u200cbeen largely driven by government borrowing.<\/p>\n
He also pointed to a sharp acceleration in debt at the start of the year by Chinese non-financial corporate borrowers – predominantly state-owned firms – which significantly outpaced borrowing by the country’s government.<\/p>\n
Outside the world’s two biggest economies, debt across mature markets edged lower, while emerging markets, excluding China, saw levels rising modestly to a record $36.8 trillion driven by government borrowing.<\/p>\n
Looking at key debt ratios, global debt stood at \u200c305% of world economic output, broadly stable where it had \u200bbeen since 2023. However, debt ratios followed a similar pattern \u200bas debt levels – trending lower in mature markets \u200band rising steadily in emerging economies.<\/p>\n
Overall, the biggest increases over that period were recorded \u200cin Norway, Kuwait, China, Bahrain, and Saudi Arabia – \u200beach recording gains of \u200bmore than 30 percentage points of GDP, the IIF report showed.<\/p>\n
The IIF predicted that structural pressures – including aging populations, rising spending on defense, energy security and diversification, cybersecurity and AI-related capital expenditure – would \u200bpush both government and corporate debt \u200clevels higher over the medium- to long-term.<\/p>\n","protected":false},"excerpt":{"rendered":"By Karin Strohecker LONDON, May 6 (Reuters) – Investors are showing signs of diversifying away from U.S. Treasuries…\n","protected":false},"author":2,"featured_media":652183,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[45,49,48,36168,242042,46,242043,86953,50137,176932,57761],"class_list":["post-652182","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-ca","tag-canada","tag-debt-levels","tag-debt-ratios","tag-economy","tag-emre-tiftik","tag-global-debt","tag-government-debt","tag-u-s-treasuries","tag-u-s-treasury"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/652182","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=652182"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/652182\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/652183"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=652182"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=652182"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=652182"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}