COVID-19 Is Increasing Government Debt Obligations
Governments around the globe are putting together massive COVID-19 relief packages, increasing debt obligations, according to The Economist.
This isn't the first time governments have had to bail out the economy, but how will the increase in government debt impact the overall economy? The relief package being discussed by Congress is worth almost 10 percent of GDP in 2019.
This increase in government debt could ripple into other economic factors. The government borrowing at the lowest rates with increasing debt leaves less wiggle room for consumers already struggling to meet obligations amid the pandemic.
Furthermore, public debt in wealthy countries rose from 59 percent of GDP in 2007 to 91 percent in 2013. Governments have alleviated pressure on financial systems and allowed investors to explore global capital markets.
Governments around the globe are putting together massive COVID-19 relief packages, increasing debt obligations.