According to reports, United States President Joe Biden has reached a “temporary” US debt ceiling agreement.
The development took place due to concerns about a possible default in early June. Biden urged the US Congress to quickly pass the deal. According to reports, Biden and House majority leader Kevin McCarthy have “agreed in principle” to raise the federal government’s trillions-dollar debt ceiling.
Joe Biden Reaches Loan Ceiling Agreement As Default Concerns Continue
After a May 27 phone call between Biden and McCarthy, an agreement was reportedly reached to temporarily raise the $31.4 trillion debt ceiling. Biden confirmed on Twitter that there was an “agreement in principle” and said that this agreement would protect the United States from “falling into a catastrophic default”. Biden has called for the deal to be submitted to the US House and Senate “the next day”, with both houses quickly passing the deal.
Earlier this evening, Speaker McCarthy and I reached a budget agreement in principle.
It is an important step forward that reduces spending while protecting critical programs for working people and growing the economy for everyone. And, the agreement protects my and…
— President Biden (@POTUS) May 28, 2023
McCarthy, on Twitter, confirmed the deal in principle, claiming that Biden was wasting his time and refusing to negotiate for months.
https://twitter.com/Croesus_BTC/status/1650934342074646529
While the exact details of the deal are not yet fully known, the US government has reached an agreement by limiting its spending for the next two years, Reuters reported. Negotiators have agreed to keep non-defense discretionary spending at 2023 levels and increase it by 1 percent by 2025, according to a source familiar with the matter.
The deal comes after US Treasury Secretary Janet Yellen warned on June 1 of the risk of default and urged Congress to take action as soon as possible. In addition, a report by the US Congressional Budget Office highlighted the significant risk that if the debt ceiling remains unchanged, the government will be unable to make payments in the first two weeks of June.
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