US Treasury can meet all obligations after debt ceiling suspension
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The Treasury has said it expects to borrow US$733 billion in the July to September quarter.
PHOTO: REUTERS
WASHINGTON - The United States Treasury said it can now meet the federal government’s payment obligations after a debt ceiling suspension, following earlier warnings that it would run short of funds on Monday if Congress failed to act.
“Now that Congress has acted to suspend the debt limit, Treasury has the tools needed to ensure that the US continues to meet all of our obligations,” Treasury spokesman Christopher Hayden said in an e-mailed statement on Monday.
Treasury Secretary Janet Yellen had warned Congress that without a debt ceiling increase, Treasury would be unable to make an estimated US$92 billion (S$124 billion) in payments and transfers this week, including a US$36 billion adjustment to the Social Security and Medicare trust funds.
The Treasury on Friday auctioned US$15 billion worth of one-day cash management bills that settled on Monday and mature on Tuesday.
After President Joe Biden signed the debt ceiling legislation on Saturday,
The debt ceiling suspension allows the Treasury to maintain its planned auction schedule for total borrowings of US$726 billion in the April-June quarter.
The plan assumes an end-June cash balance of US$550 billion. The Treasury has said it expects to borrow US$733 billion in the July-September quarter, for an end-September cash balance of US$600 billion.
The Treasury’s cash balance as at Thursday fell to just US$22.9 billion – below the US$54 billion on hand on Aug 2, 2011, when Congress also had narrowly avoided a debt ceiling default. REUTERS
