President Joe Biden and congressional leaders failed to reach a deal on raising the debt ceiling during a meeting at the White House on Tuesday. The leaders agreed to meet again at the end of the week to continue negotiations. The Treasury Department and budget experts have warned that a bill must be signed by early June to avoid the U.S. defaulting on its debts, which could have catastrophic economic consequences.
Republican leaders have demanded spending cuts in exchange for lifting the ceiling, while Democrats argue that discussions over the budget should happen during the normal lawmaking process. If a solution isn't reached before June, the U.S. may have to issue more bonds or temporarily suspend the limit. The third option - default - would be catastrophic.
The Bipartisan Policy Center has narrowed its X-date range to between early June and early August. White House press secretary Karine Jean-Pierre accused Republican lawmakers of "manufacturing a crisis" and holding the U.S. economy hostage by demanding spending cuts. The U.S. Chamber of Commerce has called for a bipartisan agreement to raise the debt ceiling.
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.