U.S. deficit estimated at $2 trillion; could rise by an additional $6 trillion if interest rates climb by 1.5 percentage

The Congressional Budget Office (CBO) projected the U.S. federal deficit for fiscal year 2026 at $2 trillion (approximately 2,671 trillion won), warning that if all interest rates rise 1.5 percentage points above baseline, cumulative deficits from 2026 to 2036 could increase by an additional $6 trillion (about 8,012 trillion won). In its monthly budget review released October 8, the CBO said the deficit grew by $218 billion (roughly 291 trillion won) compared with the prior fiscal year, as spending rose 6% while revenue increased only 3%. The agency attributed the widening gap to higher net interest outlays—the federal government's interest burden—along with increased spending on major entitlement programs, defense, and education. The figures underscore how rising borrowing costs compound fiscal pressure, since maturing Treasury debt rolled over at higher rates drives interest expenses higher and forces additional issuance. Investors will be watching upcoming Treasury refunding announcements and monthly CBO updates for signals on the trajectory of net interest costs and deficit financing needs.