Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

US Debt Default Would Have 'Very Serious' Global Repercussions: IMF

US Debt Default Would Have 'Very Serious' Global Repercussions: IMF

The IMF warned Thursday of the potential for higher borrowing costs, broader global instability and economic repercussions in the event of a US default.
The International Monetary Fund warned Thursday of severe consequences if the US defaults on its debt, ahead of a rapidly-approaching deadline for the country to raise or suspend its borrowing limit.

"Our assessment is that there would be very serious repercussions not only for the US but also for the global economy should there be a US debt default," IMF communications director Julie Kozack told reporters, encouraging all parties to urgently resolve the matter.

Republicans and Democrats remain sharply divided over the debt ceiling, with Republicans in Congress insisting that President Joe Biden's administration agree to significant budget cuts in exchange for support to lift the limit before the country runs out of money to pay its existing bills.

Democrats have been calling for a "clean" increase of the borrowing limit, accusing Republicans of using extreme tactics to try and push their political agenda ahead of the so-called "X-date" -- the point at which the US will be unable to meet its financial obligations.

Broader Instability

The IMF warned Thursday of the potential for higher borrowing costs, broader global instability and economic repercussions in the event of a US default.

"We have seen a world in the last few years that has been affected by many shocks, so we would want to avoid those severe repercussions," Kozack said.

The lifting of the debt ceiling has historically been seen as a routine affair, given that it involves raising money to pay for spending commitments already made by Congress.

When Republicans won a narrow majority in the House of Representatives during last year's midterm elections, the right wing of the caucus insisted incoming speaker Kevin McCarthy tackle the ballooning US debt in exchange for their support.

But with the Biden administration refusing to negotiate on the debt ceiling, a standoff has arisen just weeks before the US risks running out of money to pay its obligations.

President Biden met with McCarthy earlier this week in a failed attempt to find common ground on the issue.

"Default is not an option," Biden said after the talks had concluded, while McCarthy told reporters he "didn't see any new movement" in the meeting, which was also attended by the Senate majority and minority leaders and the minority leader of the House.

The talks will resume on Friday as both sides look to resolve the issue before the X-date, which the US Treasury recently warned could come as soon as June 1.
Comments

Anna 1 year ago
Default is what happens when ypu over spend your income. Let the US default as this is obviously the only way it is ever going to stop. They can not afford to repay the 31 trillion dollars they owe now so why allow them more

Newsletter

Related Articles

0:00
0:00
Close
Ukraine's Fight Against Corruption Gains Ground Amid War
Czech President Petr Pavel Injured in Motorcycle Accident
Baltic NATO Members to Construct 'Drone Wall'
German Property Crisis Worsens as Foreign Investment Declines
ICC Seeks Arrest Warrants for Israeli and Hamas Leaders
Julian Assange Faces US Extradition: Key Facts
Jacob Zuma Takes Campaign to ANC Stronghold Soweto
Attempted Assassination of Slovakia PM Robert Fico: Investigation Ongoing
Top Tory MP Raises Concerns Over Government Green Targets
Keir Starmer’s Six Key Promises Evaluated
Slovakia Faces Political and Social Turmoil
France Riles Allies by Inviting Russia to D-Day Ceremony
Poland to Spend €2.3 Billion to Reinforce Border with Russia and Belarus
Poland Supports Rolls-Royce's Nuclear Power Plant Initiative
European Ports Overflow with Unsold Electric Vehicles
Esprit Files for Bankruptcy in Europe, Putting Hundreds of Jobs at Risk
Tesla Receives Approval for German Plant Expansion
Slovakian Prime Minister Robert Fico is in life-threatening condition after being shot multiple times
Xi Jinping Highlights Europe's Divisions Ahead of Putin Visit
German Court Rules AfD Can Be Monitored for Extremism
Xi Jinping Highlights Europe's Divisions Ahead of Putin Visit
UN General Assembly Approves Palestinian Membership Bid
Teens Forming Friendships with AI Chatbots
WhatsApp Rolls Out Major Redesign
Neuralink's First Brain Implant Experiences Issue
Apple Unveils New iPad Pro with M4 Chip, Misleading AI Claims
OpenAI to Announce Google Search Competitor
Apple Apologizes for Controversial iPad Pro Ad Featuring Instrument Destruction
Boeing 737 Catches Fire in Senegal, 10 Injured
Cruise Ship Arrives in NYC with Dead 44-Foot Whale on Bow
Trump lawyer questions Stormy Daniels' account of sex with Trump
Hunter Biden's Gun Charges Upheld, Trial Set for June
Last Indian soldiers leave Maldives
Espionage Scandal in Poland: Listening Devices Found Before Government Meeting
Apple Faces Significant Sales Decline Amid AI Integration Delay
Netanyahu's Firm Stance Amid Rafah Hostage Talks
New UK Laws: Banning Weak Passwords for Internet-Connected Devices to Enhance Cybersecurity
Spanish Prime Minister May Announce Resignation
New Study: Vaping May Lower Fertility in Women Trying to Get Pregnant
U.S. DOJ Seeks Three-Year Sentence for Binance Founder Changpeng Zhao
Orban: Destroy Liberal World Order - Predicts End This Year
Diplomatic Tensions: Sunak Clashes with Macron Over Rwanda Plan
A Jewish woman was kidnapped and raped in Gennevilliers (a suburb in western Paris), France, on the background of hatred for Israel
Russia: Deputy Defense Minister Arrested on Suspicion of Taking Bribes
Stanford Researchers Discover Child Abuse Material in AI Image Generator Dataset: Can Regulations Prevent Explicit Deepfakes of Children?
Record-Breaking 'Extreme Heat Stress' Days in Europe's Contrasting 2023 Summer: A Health Threat
Thousands Evacuated: 1,000-Kg NATO Bomb Removed from Serbian City
European Car Sales Drop 5.2% in March: Electric Vehicles Face Challenges Amidst Market Downturn and High Prices
Urgent Call from William Burns as Kyiv Braces for Russian Summer Offensive.
IMF Boosts Russia's 2024 Economic Growth Forecast to 3.2%
×