Quick overview

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China, France, the United States, Germany, the United Kingdom, and Japan posted the largest increases in debt levels in dollar terms, while emerging markets added $3.4 trillion.

Global debt climbed to an all-time high of $337.7 trillion at the end of the second quarter of 2025, driven by looser global financial conditions, growing instability, a weaker dollar, and more accommodative stances from major central banks.

The report, released by the Institute of International Finance (IIF), showed that debt rose by $21 trillion compared with the first quarter. The magnitude of the increase was comparable to the second half of 2020, when pandemic-driven monetary responses triggered an unprecedented jump in global debt.

A key measure highlighted was the debt-to-GDP ratio, which reflects a nation’s repayment capacity. Canada, China, Saudi Arabia, and Poland saw the sharpest increases, while the ratio declined in Ireland, Japan, and Norway. Globally, the debt-to-GDP ratio edged slightly lower but remained above 324%.

Emerging Markets Debt

Emerging-market debt climbed by $3.4 trillion in Q2, hitting a record $109 trillion. These economies face nearly $3.2 trillion in bond and loan repayments before year-end.

The emerging-market debt-to-GDP ratio rose to a new record of 242.4%, following a downward revision in the May report.

The IIF flagged mounting concerns about U.S. short-term debt, which now accounts for roughly 20% of total public obligations and about 80% of Treasury issuance.