Speaking to reporters in Air Force 1, Trump said officials considering wasted spending may shift their focus to US debt payments, with the $36 trillion debt burden likely not too high. He said he suggested.
Market participants on Monday showed potential for future reductions in the country’s overall debt burden due to federal government overhauls through government efficiency (DOGE) led by billionaire Elon Musk. Market participants were speculated, but they said that. It is unlikely to mean disruption in future debt payments.
“It could be a payment from the Ministry of Finance…this is not directly related to financial obligations,” said Prashantbayani, Asia’s Chief Investment Officer at BNP Pariba Wealth Management. “If they stopped paying financial debts to the holders, I would be very surprised, it’s like shooting yourself with the foot,” he said.
Doge has caused privacy and security concerns as it disrupts operations in several federal agencies and gained sensitive pay and access to spending records. A federal judge on Saturday cited the risk of a data leak, temporarily banning Musk’s team from accessing the government’s payment system.
Trump’s debt statement follows comments from Treasury Secretary Scotty Bescent, who in an interview with Bloomberg last week said the US government’s borrowing trajectory was declining. This means that after guidance from the Treasury last week, the market eased concerns about the imminent rise in long-term government debt issuance. “If we put these comments along with Trump’s comments… I think this will be a very positive development for the financial market,” said Tony Farren, managing director of Mishler Financial Group. . However, he added that evidence of lower borrowing requirements should be converted to a decline in the market financial obligation auctions in order to fully take into account the progress of government agencies.
“They’ll have to come out and tell us the specifics they’ve found,” he said.
The Treasury Department, the White House and three major credit rating agencies did not immediately respond to requests for comment.
Benchmark 10-year Treasury yields were slightly higher on Monday, ahead of roughly $125 billion this week in a three-year, 10-year U.S. Treasury auction that tests government debt demand. US Sovereign Credit Default Swap (CDS) – Market-based Gauge of Default Risk – has not been changed.
“We consider (Trump’s) comments to refer to certain payments… not unpaid US financial securities,” US broker BTIG said in a memo.
“We firmly believe that the White House recognizes the confusion that arises from questioning the effectiveness of U.S. Treasury securities that reinforce our belief that the President is discussing certain budget items.” He says that.
