US at risk of default as early as June, says Congressional Budget Service

A risk closer than expected. The United States could find itself in default of payment as of the beginning of June, if no agreement is reached between Democrats and Republicans to raise the ceiling of the debt, indicated Friday May 12 the service of the budget of the Congress (CBO, in English).

The CBO, a politically independent agency responsible for providing Congress with fiscal and economic analysis, had previously estimated that this was likely to happen between July and September. However, the Treasury Department had already mentioned the date of June 1 for a possible default in payment by the world’s largest economy, an unprecedented situation.

A showdown between Democrats and Republicans

The CBO notes that “additional extraordinary measures” and end-of-quarter tax receipts could allow the government to “finance its operation until at least the end of July”.

The debt of the world’s largest economy reached 31,000 billion dollars (28.5 billion euros) on January 19, ie the ceiling beyond which the country can no longer issue new loans to finance itself. Temporary emergency measures have been taken to continue paying. Democrats and Republicans are engaged in a showdown on this issue, the Republican opposition refusing, for the moment, to raise the debt ceiling without concessions. A meeting is scheduled for early next week at the White House.