US debt ceiling limit, deadline: All you need to know

The US government will reportedly hit $31.4 trillion borrowing limit on Thursday even as the country's treasury is all set to take "extraordinary measures" to tackle debt ceiling situation, according to a report.

However, economists have predicted that measures can provide relief for a few months and there may be conflict between lawmakers and Biden administration.

US debt ceiling

The debt ceiling denotes the cap on how much the federal government can borrow. The Congress fixes the limit.


In December 2021, the cap was extended to $31.4 trillion.

Given the current situation, the ceiling has to be lifted in order to pave way for the US government to keep on payments and avoid a default.

However, political equation is not so favourable. Democrats control the Senate, Republicans are in charge for the House of Representatives.

Extraordinary Measures

US Treasury secretary Janet Yellen has announced "extraordinary measures" with a view to generate additional capacity to borrow.

The Treasury has announced that new investments will be suspended for several government accounts. There may be some changes in federal employees' Thrift Savings Plan.

FAQs:

1. How many times has the US raised the debt ceiling?
   Since 1960, there were 78 ocassions when Congress had to act. While 29 times during Democratic rule, 49 times during Democratic presidential rule.
2. What happens if US defaults on debt?
   US dollar will weaken if the US defaults on debt.