US Treasury Secretary "finalizes" forecast of US default time

US Treasury Secretary Janet Yellen on May 26 'locked in' the deadline to raise the federal debt limit, according to which, the US government could default as early as June 5 if the national debt ceiling - 31.4 trillion USD - is not raised.

US Treasury Secretary Yellen 'finalizes' forecast of US default time. (Source: Nytimes)

Previously, US Treasury Secretary Yellen predicted that the US would default on June 1 if the parties could not reach an agreement on raising the debt ceiling.

The "extension" gives the White House and congressional negotiators more time to negotiate a deal to raise the statutory cap on the nation's borrowing capacity.

In a letter to Congress, Ms. Yellen said the Treasury Department will make more than $130 billion in scheduled payments in the first two days of June, including payments to veterans, Social Security beneficiaries and Medicare beneficiaries.

“During the week beginning June 5, the Treasury expects to make approximately $92 billion in payments and transfers (including approximately $36 billion in quarterly adjustments to the Social Security and Medicare trust funds). As a result, our projected resources will not be sufficient to meet all of these obligations,” the letter said.

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