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Sovereign Debt & Fiscal Dominance

Public debt starts to bind when the interest rate on it durably exceeds nominal growth. At that point a central bank can find itself weighing price stability against the financing needs of the state: fiscal dominance, rarely declared, often visible first in bond spreads. US federal debt and interest-cost series since 1947, deficits at full employment, every government shutdown since 1976 and the 2022 gilt crisis ground the concept in data.

16pieces
5in-depth analyses
6datasets

Where to start

Three reads, in order: the basics, the full mechanism, then what the data says.

01The basics The U.S. federal deficit at each business-cycle low in unemployment TL;DR. The last two times U.S. unemployment fell to a business-cycle low with the budget in surplus were 1969 and 2000. AnalysisRead → 02The full mechanism Every US Government Shutdown Since 1976: All 23 Funding Gaps, Dates, Duration, Cost All 23 US federal funding gaps since 1976: dates, full days, scope, furloughs, cost estimates and dispute (CRS, House Historian). StudyRead → 03The evidence US Debt Ceiling: How TGA Drawdowns Inject Trillions in Liquidity Weekly Treasury General Account data with quantified drawdowns for every debt ceiling episode since 2011: methodology, regime classification and QE comparison. StudyRead →

Research and data

Our in-depth research and the downloadable series on the subject.

Dataset 121.19%Latest value · April 2026 GFDEGDQ188S: US Federal Debt to GDP Quarterly Ratio Since 1966 See the data → Dataset 65.65%Latest value · April 2026 US Household Debt to GDP: Quarterly Ratio from Fed Z.1 Household Debt and Nominal GDP Since 1947 See the data → StudyUS Federal Deficits Above 5% of GDP at Full Employment (1929–2025) StudyThe 2022 UK gilt crisis: an inflationary regime, a regional fracture

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Related topics

The subjects that most often intersect with this topic in our analyses.

Economic Cycles64 pieces A slowdown is not a recession, and quarterly headlines rarely reveal which phase the economy is in. 5 in common → Yield Curve47 pieces The slope of the yield curve is the market’s compressed forecast for growth, inflation and central bank policy. 4 in common → Financial Instability24 pieces Financial stress is measurable: it often shows up in volatility and credit spreads before it reaches the headlines. 1 in common → Global Liquidity34 pieces The Fed’s balance sheet is not market liquidity, even though the two are often treated as one. 1 in common → Inflation114 pieces Inflation is a regime rather than a monthly print, and its persistence matters more than its level. 1 in common → Metals & Critical Minerals46 pieces Gold answers to real rates, copper to industrial activity, uranium to power demand: each metal runs on its own driver. 1 in common →
This topic also exists in French.Dette souveraine et dominance budgétaire, 9 pieces →