US could hit debt limit in January 2025? Janet Yellen warns of $36.1 trillion risk as crisis looms
Treasury Secretary Janet Yellen said Friday, urging Congress to “act to protect the full faith and credit” of the country. Lawmakers have suspended the debt ceiling – a limit on government borrowing to pay for bills already incurred – until January 1 next year.
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This means that on January 2, a new limit will be set matching the amount of debt issued by the Treasury Department. “Treasury currently expects to reach the new limit between January 14 and January 23, at which time it will be necessary for Treasury to start taking extraordinary measures,” Yellen wrote in a letter to congressional leadership.
The United States is not set to hit the debt limit once the suspension is over, as the country’s outstanding debt is projected to decrease by around US$54 billion on January 2, Yellen noted.
This is “mostly due to a scheduled redemption of nonmarketable securities held by a federal trust fund associated with Medicare payments,” she added.
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