US debt ceiling crisis: the country could default on June 1

While the impasse continues between the representatives of the two political wings in the US; This brings the possibility of the US economy defaulting for the first time in history and disrupting financial markets on a global scale.

The Senate has yet to signal any action to address the looming debt ceiling crisis. Republicans rejected calls for an unconditional increase to the $31.4 trillion cap, while Democrats ignored ideas from the talks.

MOVE FROM BIDEN

US President Joe Biden invited four high-ranking congressmen to the White House next week after the Treasury Department warned yesterday that the government could run out of money to make payments before June 1.

In her letter to Congress, US Treasury Secretary Janet Yellen said that if Congress does not pass the necessary regulations, the department may not be able to pay its obligations “probably as of June 1.”

DEFECT COMING?

The possibility, heralded by Yellen, raised the risk of an unprecedented US default looming, which is believed to rock the global economy if it occurs. The dispute over the debt ceiling between Democrats and Republicans in Washington has been going on for months.

Biden called Kevin McCarthy, the Republican Speaker of the US House of Representatives, who was in Jerusalem on a diplomatic trip, and invited him to meet at the White House on May 9. Biden and McCarthy had not spoken on the issue since February.

Biden also invited House Democratic Leader Hakeem Jeffries, Senate Majority Leader Chuck Schumer and Republican Leader Mitch McConnell to the White House. (Reuters)