The US Congressional Budget Office estimated, on Wednesday, that the United States threatened to default on debt obligations by next July if lawmakers failed to overcome the deadlock and raise the federal borrowing limit.
The predictions of the nonpartisan office, which makes recommendations to Congress, come as Republicans threaten not to agree to raise the federal credit limit unless Democrats first agree to major future budget cuts.
“If the debt limit remains unchanged, the government’s ability to borrow using exceptional measures will run out between July and September 2023,” the budget office said.
Last January, the United States exceeded its borrowing cap of $31.4 trillion, prompting the Treasury Department to initiate procedures allowing it to continue funding government activities.
The ministry said, earlier, that “extraordinary measures” are likely to continue until early June.
And the Congressional Budget Office warned, on Wednesday, that “if the debt limit is not raised or suspended before the extraordinary measures are exhausted, the government will not be able to pay its obligations in full.”
“As a result, the government will have to delay payments for some activities or default on its debt obligations, or both,” he added.
The office said the latest deadline remains uncertain and if collections are not made, the Treasury could run out of money before July.
#Washington #threatened #default #debts