And last week, Republicans in the House of Representatives voted in favor of a plan to raise the national borrowing limit alongside sweeping spending cuts, amid a showdown with Democratic President Joe Biden over “excessive” public spending.
The United States reached the borrowing limit of $31.4 trillion in January, and the Treasury Department has taken exceptional measures that allow it to continue financing the activities of the State.
But if Congress does not raise or suspend the debt ceiling before the extraordinary tools are exhausted, the country risks defaulting on its obligations, with disastrous repercussions for the economy.
“Our best estimate is that we will not be able to continue to meet all government obligations by early June, possibly as early as June 1, if Congress does not raise or suspend the debt ceiling. before that date,” Yellen said in a letter. to Republican House Speaker Kevin McCarthy.
“Given the current outlook, it is imperative that Congress act as quickly as possible to raise or suspend the debt ceiling in a way that provides long-term certainty that the government will continue to make its payments,” said she added.
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