Democratic-run Washington appears set to avoid a U.S. default in the near term, with the House’s majority leader promising a vote Tuesday on a bill raising the federal borrowing limit after the Senate acted late Thursday. Treasury Secretary Janet Yellen has “said that if the House fails to act next week, the country will be unable to pay its bills,” said the No. 2 House Democrat, Rep. Steny Hoyer of Maryland, in a news release. “This cannot happen. Therefore, the House will convene on Tuesday, October 12, to pass this stopgap measure, and I expect we will complete our work that evening.”
Meanwhile, White House press secretary Jen Psaki said in a statement that Thursday night’s votes in the Senate represent “welcome steps forward in averting a default that would have been devastating for our economy and for working families.” “President Biden looks forward to signing this bill as soon as it passes the House and reaches his desk,” she added. The Senate approved a $480 billion increase in the debt ceiling, allowing for federal borrowing until Dec. 3, when funding for the federal government is also due to end. Follow a long standoff on raising the debt limit, Senate Minority Leader Mitch McConnell, the Kentucky Republican, late Wednesday proposed the short-term lift, passed through normal procedures. “The debt extension just kicks the can to December when Congress will have to address the debt ceiling again,” analysts at Height Capital Markets said in a note. U.S. stock futures
traded flat to lower on Friday morning following a weaker-than-expected jobs report, after the equity market
rose on Thursday, helped by the progress on Washington in avoiding the default.