U.S.
Treasury
Secretary
Janet
Yellen
and
Ukraine
Prime
Minister
Denys
Shmyhal
speak
to
the
press
after
holding
a
bilateral
meeting
at
the
U.S.
Treasury
Department
Building
in
Washington,
D.C.,
U.S.
April
13,
2023. 

Ken
Cedeno
|
Reuters

WASHINGTON

Treasury
Secretary
Janet
Yellen
reaffirmed
to
Congress
on
Monday
that
the
United
States
could
default
on
its
debt
as
early
as
June
1.

“With
additional
information
now
available,
I
am
writing
to
note
that
we
still
estimate
that
Treasury
will
likely
no
longer
be
able
to
satisfy
all
of
the
government’s
obligations
if
Congress
has
not
acted
to
raise
or
suspend
the
debt
limit
by
early
June,
and
potentially
as
early
as
June
1,”
she

wrote
.

The
guidance
came
as
the
White
House
and
congressional
leaders prepared
to
meet
Tuesday to
continue
negotiations
over
potential
spending
cuts
in
exchange
for
House
passage
of
a
debt
ceiling
hike.
The
Democratic-majority
Senate
is
expected
to
back
whatever
the
White
House
negotiates
with
the
GOP-controlled
House.

In
recent
days,
conflicting
reports
have
emerged
about
whether
negotiators
are
making
progress.

President

Joe
Biden

sounded
optimistic
this
past
weekend
about
reaching
a
deal
with
Republicans
to
raise
or
suspend
the
debt
limit
in
time
to
avoid
economic
fallout
from
even
a
potential
U.S.
debt
default.

“I
really
think
there’s
a
desire
on
their
part,
as
well
as
ours,
to
reach
an
agreement,
and
I
think
we’ll
be
able
to
do
it,”
Biden
told
reporters
Sunday
in
Delaware.
He
added,
“I
remain
optimistic
because
I’m
a
congenital
optimist.”

But
that
optimism
wasn’t
matched
on
the
other
side
of
the
table.

“I
still
think
we’re
far
apart,”
McCarthy
told
NBC
News
on
Monday
outside
the
Capitol.
“It
doesn’t
seem
to
me
yet
that
they
want
a
deal.”

As
she
has
in
prior
letters
to
Congress,
the
Treasury
secretary
underscored
the
urgency
of
the
situation.

“Waiting
until
the
last
minute
to
suspend
or
increase
the
debt
limit
can
cause
serious
harm
to
business
and
consumer
confidence,
raise
short-term
borrowing
costs
for
taxpayers,
and
negatively
impact
the
credit
rating
of
the
United
States,”
Yellen
wrote.

“In
fact,
we
have
already
seen
Treasury’s
borrowing
costs
increase
substantially
for
securities
maturing
in
early
June,”
she
wrote.

The
Tuesday
meeting
between
Biden,
House
Speaker
Kevin
McCarthy,
R-Calif.,
Minority
Leader
Hakeem
Jeffries,
D-N.Y.,
Senate
Majority
Leader
Chuck
Schumer,
D-N.Y.,
and
Minority
Leader
Mitch
McConnell,
R-Ky.,
was
initially
scheduled
for
Friday,
but
postponed
until
Tuesday
to
give
aides
more
time
to
talk.

The
new
letter
also
came
just
days
after

guidance

from
the
Congressional
Budget
Office
that
said
tax
revenues
and
emergency
measures
after
June
15
“will
probably
allow
the
government
to
continue
financing
operations
through
at
least
the
end
of
July.”

“If
the
debt
limit
remains
unchanged,
there
is
significant
risk
that
at
some
point
in
the
first
two
weeks
of
June,
the
government
will
no
longer
be
able
to
pay
all
of
its
obligations,”
said
the
CBO
report.