About half of the $13 billion in debt that Musk is posting on Twitter has a variable rate.
Which means that if the Federal Reserve raises interest rates, the cost of the debt would rise.
In an effort to control inflation, the Fed is anticipated to raise rates once again the following month, maybe by as much as 75 basis points.
According to Jordan Chalfin, a senior analyst at credit research firm CreditSights.
Twitter now owes about $1.2 billion in interest annually, up from an estimated $900 million in May.
This is so because the financing's $6.5 billion loan component—which banks may have to finance themselves—is set up as a margin over an ever-changing benchmark rate.