The US government will hit the debt ceiling on Thursday. The new Congress links political demands to fiscal policy.
New York/Washington, DC It’s mid-January and the newly elected Congress is in power. And majorities were redistributed: Republicans (almost) won the House of Representatives, while Democrats held a majority in the Senate. And these divisions in the US legislature make life difficult for the administration of Democrat Joe Biden. How much, it shows for the first time this week: the US government will hit the so-called debt ceiling, the debt ceiling – at 31.4 trillion US dollars is the end of borrowing money.
The moment is expected on Thursday, the Ministry of Finance announced last week. The head of the department responsible, Janet Yellen, will have to resort to “extraordinary means” to ensure the US’s ability to pay. These measures may come into force in the middle of the year or at the latest in August. Then things will get tight, Wall Street fears: the government may actually not be able to pay the debts in September, reports the Axios news platform. A US default would have a huge impact on global financial markets.