The U.S. Congress is likely to vote in a timely fashion to suspend or raise the federal debt limit - Fitch

The U.S. Congress is likely to vote in a timely fashion to suspend or raise the federal debt limit, Fitch Ratings says, as both Congress and the presidency now are under Republican control. 

Key quotes

"After the re-imposition of the ceiling, the Treasury cannot add to the debt stock, but can continue to rely on "extraordinary measures". The Congressional Budget Office estimates that the government could finance itself until "sometime this fall". No Treasury estimate is yet available."

"We think Republican control of both branches of government makes it more likely that Congress will vote to raise or suspend the debt ceiling in a timely fashion. For Republicans, resistance would draw the ire of a Republican president and could be unpopular with the electorate."

"Prioritizing debt service after extraordinary measures were exhausted implies that the U.S. government could fall behind on contractual obligations to employees, pensioners and suppliers. Failure to honor non-debt service obligations would not be a default under Fitch's Sovereign Rating Criteria."