Global debt accumulation surged in the past year, reaching its fastest pace since the pandemic, according to the Institute of International Finance (IIF). Total global debt climbed by almost $US29 trillion, hitting a new record high of $US348 trillion. The IIF reported that approximately two-thirds of this increase originated in mature markets, fueled by rising deficit spending.
The IIF highlighted that debt levels have reached new peaks in both advanced and emerging economies, indicating a widespread increase in borrowing. Looking forward, the institute anticipates that global debt accumulation will remain strong due to increasing government borrowing requirements. The United States, China, Germany, Japan, and India are expected to contribute significantly to this trend.
Despite recent discussions about foreign capital potentially leaving the US amid diversification and de-dollarisation efforts, the IIF notes that the US has maintained its position as a safe haven for investors. The report suggests that despite global economic shifts, the US continues to attract and retain significant capital inflows, reinforcing its role in the international financial system. The Institute of International Finance provides insights into global financial trends.
