US Treasury Secretary "finalizes" forecast of when US will default

On May 26, US Treasury Secretary Janet Yellen 'locked in' the deadline to raise the federal debt limit, according to which, the US government could default as early as June 5 if the national debt ceiling - 31.4 trillion USD - is not raised.

US Treasury Secretary Yellen 'finalizes' forecast of when US will default. (Source: Nytimes)

Previously, US Treasury Secretary Yellen predicted that the US would default on June 1 if the parties did not reach an agreement on raising the debt ceiling.

The "extension" gives the White House and congressional negotiators more time to negotiate a deal to raise the statutory cap on the nation's borrowing capacity.

In a letter to Congress, Ms. Yellen said the Treasury Department will make more than $130 billion in scheduled payments in the first two days of June, including payments to veterans, Social Security beneficiaries and Medicare beneficiaries.

“During the week beginning June 5, the Treasury Department expects to make approximately $92 billion in payments and transfers (including approximately $36 billion in quarterly adjustments to the Social Security and Medicare trust funds), and our projected resources will not be sufficient to meet all of these obligations,” the letter said.

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