Global government borrowing is on track to hit a record USD 12.3 tn in 2025, driven by rising defense spending, higher debt-servicing costs, and ongoing fiscal pressures, S&P Global forecasts. Total sovereign debt stock is expected to reach USD 76.9 tn, with global debt levels at 70.2% of GDP — slightly below pandemic highs but still elevated at a time when economies are forced to reckon with “crisis after crisis,” the Financial Times quotes Roberto Sifon-Arevalo, global head of sovereigns at S&P, as saying.

Top borrowers: The US is set to issue nearly USD 4.9 tn in long-term debt this year, driven by “wide fiscal deficits, high interest spending, and substantial debt refinancing requirements.” While the USD’s reserve currency status gives the country “significant flexibility” to manage its debt, S&P’s Roberto Sifon-Arevalo warned that rising borrowing costs are making that harder. It “was fine and sustainable… before the pandemic, now it presents a much bigger problem,” he said.

China, the second-largest borrower, is increasing issuance by over USD 370 bn to USD 2.1 tn to support its struggling economy. Outside the G7 and China, global borrowing is expected to remain broadly stable, S&P said.

Investor concerns are growing, with bond giant Pimco planning to cut exposure to long-dated US debt over “debt sustainability questions,” while b’naire investor Ray Dalio has warned the UK could fall into a “debt death spiral” as borrowing outpaces confidence.

Bigger fiscal risks: As debt-servicing costs climb, governments face increasing constraints on infrastructure and social spending, fueling a global shift toward more fiscally conservative political movements, Sifon-Arevalo is quoted as saying.

MARKETS THIS MORNING-

Asian markets are mostly in the green this morning, after China set its GDP growth forecast at 5%. Mainland China’s CSI 3000 Index rose 0.1%, while Hong Kong’s Hang Seng is up 0.3%. On the other hand, Japan’s Nikkei and Topix are both down in early trading. Over on Wall Street, futures rose slightly after another day of losses, with the Nasdaq inching dangerously close to correction territory.

TASI

11,932

-1.6% (YTD: -0.9%)

MSCI Tadawul 30

1,500

-1.7% (YTD: -0.6%)

NomuC

31,534

-0.5% (YTD: +0.2%)

USD : SAR (SAMA)

USD 3.75 Sell

USD 3.75 Buy

Interest rates

5.0% repo

4.5% reverse repo

EGX30

30,763

-0.7% (YTD: 3.4%)

ADX

9,591

+0.3% (YTD: +1.8%)

DFM

5,355

+0.5% (YTD: +3.8%)

S&P 500

5,778

-1.2% (YTD: -1.8%)

FTSE 100

8,759

-1.3% (YTD: +7.2%)

Euro Stoxx 50

5,387

-2.8% (YTD: +10.0%)

Brent crude

USD 71.12

-0.7%

Natural gas (Nymex)

USD 4.31

+4.5%

Gold

USD 2,928

+0.9%

BTC

USD 87,656

+1.1% (YTD: -6.3%)

THE CLOSING BELL: TADAWUL-

The TASI fell 1.6% yesterday on turnover of SAR 6.5 bn. The index is down 0.9% YTD.

In the green: Marafiq (+6.7%), Shl (+4.0%) and Malath Ins. (+3.0%).

In the red: Nice One (-10.0%), AlEtihad (-8.4%) and Elm (-6.5%).

THE CLOSING BELL: NOMU-

The NomuC fell 0.5% yesterday on turnover of SAR 24.5 mn. The index is up 0.2% YTD.

In the green: Taqat (+5.9%), Knowledgenet (+5.3%) and Knowledge Tower (+4.5%).

In the red: Fad (-8.5%), Horizon Food (-7.5%) and AlWasail Industrial (-6.4%).

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