Governments Cease Correcting Budget Deficits Amid Bond Market Tolerance
Governments have stopped taking actions to reduce budget deficits, but bond markets have not yet reacted negatively.
As of August 3, 2026, governments worldwide have stopped implementing measures to correct budget deficits. Despite the lack of fiscal prudence, bond markets have so far not penalized these governments. The Financial Times reports that this tolerance by bond markets continues even as budget deficits persist without correction.
Sources
Financal Times — Whatever happened to prudence?THE QUESTIONS THIS EVENT LEAVES BEHIND