The United States government extended the deadline for reaching an agreement on the debt ceiling

Treasury Secretary, Janet Yellensaid on Friday that Notional maximum loan limit extended till June 5Four days more than the earlier estimate.

However, Yellen renewed her warning in a letter to Congress that failing to raise the borrowing limit “would result in severe hardship.”

Yellen’s latest letter to lawmakers about the “X date” came as Congress adjourned for the long Memorial Day weekend. He said the Treasury Department had implemented an extraordinary measure not used since 2015 to bring the United States’ financial situation to this point.

date X comes when the government is already You do not have enough financial cushion to pay off all your loans, after exhausting the measures being used since January to raise existing funds.

early Friday, the Speaker of the House of Representatives, Kevin McCarthysaid his Republican debt negotiators and the White House had reached a critical moment, attempting to close a deal with Pres. Joe Biden To curb federal spending and raise the nation’s borrowing limit before the next deadline.

He had hoped that the frustrating talks would end at the end of the week and that an agreement would be reached later this week. The Treasury now says the government could start running out of money as soon as a week from Monday, plunging the US into a potentially catastrophic default with economic consequences around the world.

Concerned retirees and social service groups were among those making preemptive contingency plans as lawmakers left the city for the long holiday weekend. The next batch of Social Security checks will go out next week.

“The world is watching,” said the Managing Director of the International Monetary Fund. Kristalina Georgieva, After meeting with Yellen on Friday. “Let us remember that we are now in the 12th hour.”

Democrat Biden and Republican McCarthy were narrowing the gap, working to finalize details of a two-year deal that would reduce federal spending and raise legal borrowing limits beyond next year’s presidential election.

Any deal would have to be a political compromise, with support from both Democrats and Republicans, to pass a divided Congress.

“We know this is a crisis,” McCarthy said after arriving at the empty Capitol, acknowledging that more progress is needed.

Speaking at the White House while honoring the champion Louisiana State University women’s basketball team, Biden thanked one of his top negotiators by saying, He’s “closing a deal, hopefully.”

She was referring to the director of the Office of Management and Budget, Shalanda Youngwho attended the event and their representatives also attended Garrett Graves of Louisiana, a leading Republican negotiator.

(With inputs from AP)

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