US debt interest payments hit a $1.35 trillion pace: the bill has doubled in four years

Key takeaways

The federal government paid $1.35 trillion in interest over the year through June 2026, 59 percent more than three years ago. That is about $3.7 billion a day committed before any other spending decision.
Both drivers are still moving: total public debt grew $3.5 trillion in twelve months to $39.7 trillion, and the average rate the Treasury pays has climbed from 1.56 percent in January 2022 to 3.41 percent as older low-rate debt rolls over.
The interest is financed with more borrowing, which adds Treasury supply the bond market must absorb. That pressure works to keep long-term rates, and with them mortgage rates, up.

What's happening

June's interest payment came to $185.2 billion, the largest single month in the series. The trailing twelve months add up to $1.35 trillion, against $1.19 trillion a year earlier and $852 billion three years ago.

The bill is the product of two numbers, and both rose. Total public debt reached $39.7 trillion in July, up $3.5 trillion in a year. The average interest rate across all of it was 3.41 percent in June, up from a low of 1.56 percent in January 2022, because debt issued in the low-rate 2010s keeps maturing and getting refinanced at today's rates.

$3.7B

Federal interest paid per day, on average, over the year through June 2026: $1.35 trillion across 365 days.

What the interest bill means for taxpayers

Interest is the one line of the budget that is not a choice. It is owed before defense, benefits, or anything else is funded, so every dollar it grows must come from taxes, from cuts elsewhere, or from more borrowing. In practice it comes from more borrowing, which raises the balance the next year's rate applies to.

That borrowing lands in the bond market as a steady supply of new Treasuries, and as we noted in our analysis of the Fed's cutting cycle, it is one reason long-term yields have not followed the policy rate down. The interest bill and the mortgage rate are connected through the same market.

What the chart shows

The trailing-year bill sat at $329 billion as recently as June 2013 and was still $665 billion in June 2022. It has doubled in the four years since. The chart's three panels separate the mechanics: the debt panel climbs through the whole span, while the rate panel falls for two decades and then snaps back, and the bill only compounds once the two rise together after 2022.

The rate itself is not historically high. The Treasury's average rate was 6.59 percent in 2001, nearly twice today's 3.41. What is different is the balance it applies to: each tenth of a percentage point on $39.7 trillion of debt is roughly $40 billion a year, so small rate moves now carry sums that once required whole rate cycles.

What to watch

The average rate is still climbing: 3.34 percent in April, 3.35 in May, 3.41 in June. As long as maturing debt reprices above its old coupon, the bill grows even if the debt stopped growing, and the debt is not stopping. The other line to watch is the 10-year Treasury yield, which sets the cost of the long debt the Treasury issues next.

Common questions

How much does the US pay in interest on its debt?

$1.35 trillion over the twelve months through June 2026. June alone came to $185.2 billion, the largest single month in the series, which begins in 2010.

Why is federal interest spending rising so fast?

Both of its inputs are rising. Total public debt grew $3.5 trillion in a year to $39.7 trillion, and the average interest rate on that debt climbed from 1.56 percent in January 2022 to 3.41 percent in June 2026 as older low-rate debt matures and is refinanced.

What interest rate does the US government pay on its debt?

An average of 3.41 percent across all outstanding debt as of June 2026. The average was 1.56 percent in January 2022 and 6.59 percent in 2001, so the current rate is high against the 2010s but moderate against the longer record.

When did the interest bill start accelerating?

In mid-2022, when rate increases began repricing the debt. The trailing-year bill was $665 billion in June 2022 and $1.35 trillion in June 2026, a doubling in four years after growing far more slowly in the decade before.

Data: US Treasury Fiscal Data, as published in the Kitegraph library: monthly interest expense (2010 to June 2026, shown as a trailing 12-month total on the chart), average interest rate on outstanding debt (2001 to June 2026), and total public debt outstanding (1993 to July 2026). Trailing-year totals and per-day figures are computed from the monthly series.