US Sec. Yellen extends deadline for default to June 5

The US Treasury Secretary Janet Yellen spoke on Friday and extended the deadline for raising the federal debt limit, saying the government could default on its debt as early as June 5 without increasing the country’s $31.4 trillion debt ceiling.

Yellen had previously put that date as in early June, or potentially as early as June 1. Meanwhile, the US Dollar was set for a third straight weekly gain on Friday. The US Dollar index DXY, which tracks the currency against six major counterparts, was last at 104.23%.

Congress must address the debt ceiling by June 5 or the US Treasury will not have enough funds to pay all of the nation’s obligations in full and on time, Treasury Secretary Janet noted adding that “Based on the most recent available data, we now estimate that Treasury will have insufficient resources to satisfy the government’s obligations if Congress has not raised or suspended the debt limit by June 5,” she wrote in a letter to House Speaker Kevin McCarthy.

The latest letter comes as President Joe Biden and House Republicans continue to try to hammer out a deal to address the debt ceiling before the US defaults on its obligations, which would wreak havoc on the global economy and financial system.