WASHINGTON (AP) — Treasury Secretary Janet Yellen told Congress on Friday that the United States could default on its debt obligations by June 5 — four days later than expected — if lawmakers don’t. not act in time to raise the federal debt ceiling.
Yellen’s letter comes as Congress recesses for a long Memorial Day weekend, and tensions are growing over whether a deal between the White House and Republicans in Congress will be reached in time.
The so-called ‘X date’ comes when the government no longer has enough financial cushion to pay all its bills, having exhausted the ‘extraordinary measures’ it has been employing since January to stretch existing funds.
Yellen said in his letter that the agency had used such a measure for the first time since 2015 to bring the financial situation of the United States to this point: an exchange of approximately $2 billion of Treasury securities between the Fund civil service retirement and disability insurance and the Federal Finance Bank. .
“The extremely low level of remaining resources requires that I exhaust all extraordinary measures available to avoid not being able to meet all government commitments,” she said in her letter.
“We’ve already seen Treasury borrowing costs rise significantly for securities maturing in early June,” she said.
“If Congress fails to raise the debt ceiling, it would cause serious hardship for American families, harm our position as a global leader, and raise questions about our ability to advance our national security interests,” he said. she declared.
The latest projection is in line with its previous estimates that the United States could exhaust all extraordinary measures in early June and as early as June 1, but the latest deadline gives lawmakers and the White House more time to strike a deal.