The Treasury Department has asked federal agencies whether they can make upcoming payments at a later date

5/23/2023

The Treasury Department has asked federal agencies whether they can make upcoming payments at a later date.

"To produce an accurate forecast around the debt limit, it’s critical that Treasury have updated information on the magnitude and timing of agency payments," the spokesperson said in an emailed statement. "As in prior debt limit episodes, Treasury will continue to regularly communicate with all aspects of the federal government on their planned expenditures."

Meanwhile, Janet Yellen, the Treasury Secretary, sent her second letter to Congress in a fortnight, reinforcing the likelihood that the Treasury may be unable to fulfill all U.S. government payments by early June. This could lead to the first-ever U.S. default. Yellen indicated that the debt ceiling might come into effect as early as June 1.

The adjusted date comes in the wake of updated revenue and payment data received since Yellen's May 1 communication to Congress. At that time, she warned that the Treasury might deplete its cash reserves to cover government expenditures by early June, possibly even by June 1. This announcement precedes President Joe Biden's scheduled meeting with House Speaker Kevin McCarthy and an upcoming overseas trip for the President.

Read more: https://unusualwhales.com/news/yellen-warns-of-us-default-june-1st