US could face debt-ceiling crisis this summer without deal, CBO warns
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“US Treasury Department will exhaust its ability to pay all its bills sometime between July and September unless the current $31.4 trillion cap on borrowing is raised or suspended,” warned the US Congressional Budget Office (CBO) on Wednesday per Reuters.
The CBO released its annual budget outlook together with a report suggesting that a historic federal debt default could occur before July if revenue flowing into the Treasury in April – when most Americans typically submit annual income tax filings – lags expectations, reported Reuters.
“Over the long term, our projections suggest that changes in fiscal policy must be made to address the rising costs of interest and mitigate other adverse consequences of high and rising debt,” said CBO Director Phillip Swagel.
The news could be considered a catalyst for late Wednesday’s corrective bounce in the market sentiment. However, strong US data and hawkish Fed bets keep the risk barometer AUD/USD pair depressed.
Also read: AUD/USD licks its wounds near 0.6900 ahead of Aussie employment data
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