Bidens student loan freeze, Fed rate hikes weigh on debt limit deadline
Congress will have a shorter-than-expected window to negotiate a debt limit increase this year thanks to policy decisions by both the Biden administration and the Federal Reserve.
The impact of two costly moves on the governments finances President Joe Bidens decision to extend a federal student loan payment freeze plus the Feds rapid interest rate hikes are under scrutiny as analysts gauge precisely when the U.S. will run out of money to pay its bills.
Identifying that deadline, known as the X date, is crucial as House Republicans and the White House enter a stalemate over how to raise the governments borrowing authority. Treasury has warned that the U.S. will hit its $31.4 trillion debt limit Thursday, forcing the department to use extraordinary measures to avoid a potentially catastrophic default on the nations financial obligations. Treasury projects that those measures and its remaining available cash will buy time through at least early June.
But the deadline with the most political significance is the X date.
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