WASHINGTON (Reuters) – U.S. Treasury Secretary Janet Yellen said on Wednesday that she was notified early on June to raise the debt ceiling and avoid a default, saying that Congress is short on money management.
Yellen told the Wall Street Journal that the results are difficult to determine exactly when the US government will fail from the resources, but added that she will try to increase the accuracy of the equation over time, based on the income of the government.
Some private forecasters, including Goldman Sachs and Moody’s Analysts, have estimated that a default could come a few days after June 1, between June 6 and 9.
Yellen stressed on Monday that she expects to be able to pay off the US government’s debt obligations only by June 1, leaving only a week for White House negotiators and congressional Republicans to reach a compromise and an agreement approved by Congress.
Yellen said she had a lot of confidence that she would get bipartisan support, adding that President Joe Biden had offered businessmen proposals that would reduce the deficit by $1 trillion over 10 years, but she did not define how that would be done. Biden’s proposed fiscal 2024 budget request would reduce the deficit by about $3 trillion over a decade by tax increases greater than large spending increases.
However, Yellen said the Treasury and Biden will face “very difficult decisions” if Congress does not act to raise the debt ceiling. “There will be some obligations that we will not be able to pay,” he said.
The Treasury Secretary said the prioritization of payments could not be done for the Government. “We just raised the debt ceiling,” he said.
There is some tension in financial markets over the debt ceiling, and some Treasury bills in early to mid-June are trading at higher interest rates, Yellen said, adding that this is likely to increase as the debt ceiling approaches. deadline of early June. .