Central banks increasingly worried about 'unsustainable' government debt levels

Geopolitics remains primary concern

Sorin Dojan
clock • 2 min read

Central banks are increasingly worried about elevated levels of government debt, with many arguing this could stifle demand for sovereign bonds.

According to a UBS survey of reserve managers from 40 central banks, around 37% of respondents argued risks coming from "unsustainable government debt levels" have grown in importance in the last year, up from 14% a year before. Around 46% of those interviewed said they are worried debt sustainability issues could lead to a decline in demand for government bonds. However, the number of respondents concerned about the risk of a global economic recession has dropped significantly, from 56% in 2023 to only 13% in 2024. Geopolitical conflicts remained the main concern for many responde...

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