The United States will probably not run out of money until June 5 if there is no political agreement before then on an increase in the US government’s debt ceiling. Treasury Secretary Janet Yellen made that assessment on Friday.
That gives Republicans and Democrats in Congress a little more time to reach a deal. Earlier, Yellen said that the government may not have enough money to pay all the bills by June 1.
A deal between the Democrats and Republicans on the necessary increase in the debt ceiling is still pending. Republican Speaker of the House of Representatives Kevin McCarthy said he would continue to work over the coming long weekend to reach a deal. Failure to reach an agreement in time could cause major financial unrest worldwide. A large part of the American government may also come to a standstill.
Yellen said in a letter to Congress on Friday that she looked at the most current financial figures. It follows that her ministry can still make more than 130 billion dollars (more than 121 billion euros) in scheduled payments in the first two days of June. This includes social benefits. For the week of June 5, payments for a total amount of 92 billion dollars (almost 86 billion euros) are planned. According to Yellen, without raising the ceiling, it will not be possible to cough up all that necessary money.
Tensions
Then the country has borrowed the maximum amount that Congress allows, after which this institution must raise the bar again. That is usually a routine job in the US, but the tensions between the Republicans and Democrats make it an increasingly difficult story. Meanwhile, there seems to be progress in the talks between the two parties. But according to the latest reports on the negotiations, they still differ on some important points.
US President Joe Biden said on Friday that he hoped for a quick breakthrough. “We are very close and I am optimistic,” he said.
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