What is a debt-to-gdp ratio?


The Debt to GDP ratio is typically used in comparing government debt to its GDP by dividing DEBT by GDP. Let’s look at an example. Here’s a chart of total US Federal public debt and US GDP:

The most recent values for each series are:

2016 Q2
Federal Debt: Total Public Debt 19,382
US GDP 18,437

So the current ratio for Federal Debt: Total Public Debt to US GDP (e.g. 19,382/18,437) is 105%. The ratio can be useful in comparing different country’s economies together or looking a trends of the ratio over time.

Written on September 2, 2016