Global debt reached a record-breaking $324 trillion in the first quarter of 2025, according to the Institute of International Finance (IIF), marking a significant surge that raises concerns about potential economic instability. China, France, and Germany were major contributors to this unprecedented increase. The IIF reported a staggering $7.5 trillion rise in global debt compared to the previous quarter, significantly accelerating growth. 🇨🇳🇫🇷🇩🇪 are identified as key drivers behind this trend. Meanwhile, several countries like Canada, UAE, and Turkey saw reductions in their debt levels. Although the global debt-to-output ratio slightly decreased, emerging markets face a heightened risk of debt-to-GDP imbalances. Notably, China’s debt-to-GDP is projected to reach 100% this year, highlighting the escalating challenges for the nation’s economy. The rise in global debt presents substantial risks, especially as interest rates climb and inflation intensifies across various sectors. Analysts are closely observing market vulnerabilities stemming from increased borrowing costs, with potential ramifications for financial markets. The IIF notes that higher interest rates and rising inflation contribute to economic uncertainties, requiring proactive measures like increased regulatory scrutiny.