The US Treasury’s window to keep the US government from running out of borrowing room continues to narrow as declines in its cash balance to the lowest since 2021 offset a slight uptick in funds available for extraordinary measures.
(Bloomberg) — The US Treasury’s window to keep the US government from running out of borrowing room continues to narrow as declines in its cash balance to the lowest since 2021 offset a slight uptick in funds available for extraordinary measures.
The Treasury had just $92 billion of extraordinary measures to help keep the government’s bills paid as of May 17, the department said in a statement Friday. That’s up from around $88 billion on May 10 and means that a little over a quarter of the $333 billion of authorized measures are still available to keep the US government from running out of borrowing room under the statutory debt limit.
At the same time, the Treasury’s cash balance fell to $57.3 billion as of May 18, according to data published Thursday. That’s down from from $68.3 billion a day earlier and $140 billion at the end of last week. The Treasury’s bank account has been under downward pressure recently because of measures being taken to avoid breaching the $31.4 trillion debt cap.
Treasury Secretary Janet Yellen reiterated to lawmakers earlier this week that her department’s ability to avoid breaching the statutory debt ceiling via special accounting maneuvers could be exhausted around early June. She told top bank executives Thursday that a failure to raise the debt ceiling would be “catastrophic” for the financial system.
House Speaker Kevin McCarthy’s top debt-ceiling negotiators walked out of negotiations Friday morning, an abrupt reversal from optimistic signals on progress from both sides a day earlier. The Republican team’s departure from the closed-door session about an hour after it began Friday morning threw into doubt the status of talks to avoid a US default. One person familiar with the talks said it wasn’t a specific issue but ranged broadly across GOP budget-cutting demands.
This is a turnabout from the prior day when politicians in Washington expressed optimism about a deal being imminent, with even McCarthy and Senate Majority Leader Chuck Schumer making plans for votes in the coming days on a bipartisan deal.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.