Treasury's Yellen says June 5 is last date for debt ceiling to be raised
Reuters
Published May 26, 2023 04:35PM ET
Updated May 26, 2023 06:15PM ET
WASHINGTON (Reuters) -U.S. Treasury Secretary Janet Yellen on Friday set a deadline for raising the federal debt limit, saying the government would default if Congress does not increase the $31.4 trillion debt ceiling by June 5.
Yellen had previously said a default could potentially happen as early as June 1, but is now characterizing June 5 as the precise deadline.
"We now estimate that Treasury will have insufficient resources to satisfy the government’s obligations if Congress has not raised or suspended the debt limit by June 5," she wrote.
The more precise estimate buys White House and congressional negotiators slightly more time to finalize a deal to raise the statutory ceiling on the federal government's borrowing capacity.
Democratic and Republican negotiators appeared within reach of a deal on Friday but still struggled to resolve thorny differences.
In a letter to Congress, Yellen said her department will make more than $130 billion of scheduled payments in the first two days in June, including to veterans and Social Security and Medicare recipients.
"During the week of June 5, Treasury is scheduled to make an estimated $92 billion of payments and transfers," including a roughly $36 billion quarterly adjustment toward Social Security and Medicare trust funds, Yellen wrote.
"Therefore, our projected resources would be inadequate to satisfy all of these obligations," she said.
Yellen also said the department used an extraordinary cash management measure on Thursday, swapping approximately $2 billion of Treasury securities between the Civil Service Retirement and Disability Fund and the Federal Financing Bank to stave off the potential default date. The measure was last used in 2015, she said.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.