Warning US Congressmen that time is fast running out on the debt ceiling issue, Treasury Secretary Timothy Geithner has said that America could default by mid-February. 'If Congress does not act to extend borrowing authority, all of these payments would be at risk. This would impose severe economic hardship on millions of individuals and businesses across the country,' Geithner said in a letter to the Congressional leadership. The US had hit the $ 16.4-billion debt ceiling on 31 December.
Since then it has employed 'extraordinary measures' to avoid any default but it might end up mid-February if the debt limit is not increased, he said.
‘The Treasury currently expects to exhaust these e measures between mid-February and early March of this year. We will provide a more narrow range with a more targeted estimate at a later date,' Geithner said. Any estimate, will be subject to significant uncertainty because the US is entering the tax filing season when amounts and timing of tax payments and refunds are unpredictable, he said. 'For this reason, Congress should act as early as possible to extend normal borrowing authority to avoid the risk of default and any interruption in payments,' he said
Since then it has employed 'extraordinary measures' to avoid any default but it might end up mid-February if the debt limit is not increased, he said.
‘The Treasury currently expects to exhaust these e measures between mid-February and early March of this year. We will provide a more narrow range with a more targeted estimate at a later date,' Geithner said. Any estimate, will be subject to significant uncertainty because the US is entering the tax filing season when amounts and timing of tax payments and refunds are unpredictable, he said. 'For this reason, Congress should act as early as possible to extend normal borrowing authority to avoid the risk of default and any interruption in payments,' he said