Default of payment no earlier than June 5th
uS Finance Minister Janet Yellen has updated its forecast of the impending default in the absence of an agreement in the dispute over the debt ceiling. Accordingly, there is a risk of default on June 5 at the earliest, not on June 1 as previously expected, as emerged from a letter to the speaker of the US House of Representatives on Friday. The estimate is based on the most recent available data. Yellen called on Congress to protect confidence in the US and the country’s creditworthiness and to act as soon as possible.
Negotiations have been going on for weeks
For weeks, Democrats and Republicans have been arguing in tough rounds of negotiations about raising the debt limit. In the United States Parliament decides the maximum amount of money the state can borrow. A default could have catastrophic consequences not only for the US economy.
Opposition leader McCarthy spoke on Friday of “progress” in talks with the White House. Previously, several US media had reported that President Joe Biden’s administration and the Republicans would come closer in the months-long dispute years and thus be raised beyond the presidential election of November 2024.
In return, there will be cuts in certain government spending. That’s what the Republicans, who hold the majority in the House of Representatives and can block an increase in the debt limit, are demanding.