Monday, 20 September, 2021

Yellen urges Congress to raise debt limit

WASHINGTON: US Treasury Secretary Janet Yellen on Monday called on Congress to take steps to address the federal government’s borrowing limit which was hit on Sunday.

Congress suspended the debt limit in 2019, but the two-year suspension lapsed on July 31, forcing Treasury to begun taking “extraordinary measures” to remain under the ceiling and continue funding government operations, report agencies.

But private economists estimate those steps will only buy the government a few weeks after which debt repayments would be at risk unless the debt limit is increased or suspended.

“I respectfully urge Congress to protect the full faith and credit of the United States by acting as soon as possible,” Ms Yellen said in a letter to congressional leaders.

The debt limit was reset to the total as of Friday, just over US$28 trillion, according to Treasury figures.

The US national debt and deficit have soared during the Covid-19 pandemic after Washington approved three massive spending bills aimed at lessening the damage from its economic impacts.