Congress will likely need to raise the debt limit by late February to avoid a missed payment, according to Treasury Secretary Jack Lew.
In a letter sent to lawmakers Wednesday, Lew said the timeline for a borrowing boost has moved up slightly. When he first pressed Congress to increase the debt cap in December, he estimated a default could occur as late as early March.
But based on “our best and most recent information,” Lew now pegged the default deadline as sometime in late February, calling on Congress to boost it as soon as possible.
“I respectfully urge Congress to provide certainty and stability to the economy and financial markets by acting to raise the debt limit before February 7, 2014, and certainly before late February,” he wrote.
Speaker John Boehner’s office said that any debt ceiling increase needs to include concessions from President Obama.
“The Speaker has said that we should not default on our debt, or even get close to it, but a ‘clean’ debt limit increase simply won’t pass in the House. We hope and expect the White House will work with us on a timely, fiscally-responsible solution,” spokesman Michael Steel said.
October’s deal to end the government shutdown also suspended the nation’s $16.7 trillion borrowing cap until Feb. 7. On that date, the borrowing limit will be automatically increased to cover all governmental borrowing done during the suspended period.
And on that date, without an increase, the Treasury will begin to employ its set of “extraordinary measures” to free up room under the cap to remain current on payments.