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Against the backdrop of a rising U.S. federal deficit and increasing geoeconomic tensions, understanding who holds U.S. debt instruments could have important policy implications, including for the EU. This briefing provides an overview of the size and ownershBriefing - Who holds U.S. debt? Structure, ownership, Europe's exposure, and the limits of leverage - 19-03-2026
Against the backdrop of a rising U.S. federal deficit and increasing geoeconomic tensions, understanding who holds U.S. debt instruments could have important policy implications, including for the EU. This briefing provides an overview of the size and ownership structure of U.S. public debt and assesses the extent of Europe’s exposure. It further considers whether such exposure could translate into potential political leverage. The first part of the briefing outlines recent developments in the evolution of U.S. public debt, including its size, trajectory, and changing composition. The second part analyses EU Member States’ exposure to U.S. Treasury instruments. It further discusses the implications and limits of potential political leverage arising from Europe’s significant holdings of U.S. assets, highlighting the dominant role of private investors and the constraints on coordinated policy action. Finally, it considers how a possible gradual portfolio adjustment, including a gradual reduced accumulation of U.S. assets, and stronger home bias, could shape future financial flows, and how initiatives such as the Savings and Investment Union (SIU) may support a greater reallocation of European savings toward euro-denominated assets. Source : © European Union, 2026 - EP Read more
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