US: Clock is ticking to raise the debt ceiling - ING

Since March, the US has been using “extraordinary measures” to shuffle monetary around to buy time to reach an agreement on the debt ceiling, but these will probably be exhausted by the end of September, meaning a deal must be reached fast, according to analysts at ING.

Key Quotes

“For a debt ceiling bill to pass it needs 60 votes in the Senate. Given Republicans hold only 52 seats a bipartisan deal is required.”

“But even the Republicans aren’t united on this issue – many want an agreement tied to spending cuts or a slower rate of spending, something the Democrats are unlikely to sign up to.”

“In a worst case “perfect storm” a new debt ceiling crisis could lead to a spike in Treasury yields and a plunge in equities as fears over a debt default rise.”