Governments around the world are raising funds at a record pace through syndicated debt issuances as public spending rises rapidly, according to the Delfi.lv portal, citing Bloomberg.
According to data compiled by Bloomberg, sovereign issuers have already placed $504 billion in debt securities this year. This is more than in the first half of 2020, when countries were actively spending funds to support their economies during restrictions related to the Covid-19 pandemic.
Government budget deficits have been rising since the global financial crisis. They surged during the pandemic, when interest rates were cut to record lows, and is rising again now as governments ramp up defense spending and attempt to shield households from price shocks caused by the war involving Iran.
In addition, as experts note, an aging population and rising interest rates are putting further pressure on budgets.
