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Global and domestic public debt sustainability concerns
Overview
Concerns regarding rising public debt and fiscal sustainability have intensified across different economic contexts. In Turkey, domestic debt reportedly surged from 16.3 billion TL at the end of 2025 to 33 billion TL within the first nine months of 2026. This fiscal pattern involves heavy reliance on short-term loans with high interest rates, such as those exceeding 38%, to cover public sector salaries and roll over existing debt.
On a broader scale, the Bank for International Settlements (BIS) has warned that high levels of public debt and large fiscal deficits in major economies may complicate the ability of central banks to manage future financial crises. BIS chief Pablo Hernández de Cos noted that debt levels have reached heights not seen since the aftermath of World War Two, creating a risk that central bank interventions could be perceived as attempts to finance government fiscal policy, thereby increasing political controversy.
Entities
Pablo Hernández de Cos · Bank for International Settlements · Central Bank of the Republic of Türkiye · European Central Bank
Timeline
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[BUSINESS] 2 sourcesBIS Chief warns rising public debt complicates central bank crisis response
BIS chief Pablo Hernández de Cos warns that soaring public debt and fiscal deficits could make future central bank crisis interventions more difficult and politically contentious.
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[BUSINESS] 2 sourcesPublic debt rises amid concerns over fiscal sustainability
Rising domestic debt and high interest rates are sparking concerns over the sustainability of funding public sector salaries through short-term borrowing.
Sources
europesays.com · haberkibris.com · sondakikakibris.com · tekedia.com