Net interest on federal debt exceeds defense and Medicare spending, rising $35B year-over-year to $857B.
The US government spent $857 billion on net interest costs in the first nine months of fiscal 2026, surpassing expenditures on the military and Medicare. The figure reflects a $35 billion increase from the same period last year, driven by rising debt levels and higher borrowing costs.
The federal deficit widened to $1.4 trillion over the same period, pushing the national debt to $39.64 trillion. Interest payments now average $737 per month for each US household, or $95.2 billion monthly, according to budget data.
The Congressional Budget Office highlighted the growing burden of debt servicing as a key driver of fiscal strain, with no immediate market reaction reported.