Treasury Secretary Janet Yellen on Monday added a new level of urgency to her warning to lawmakers that the U.S. could run out of cash in early June.
“I am writing to note that we estimate that it is highly likely that Treasury will no longer be able to satisfy all of the government’s obligations if Congress has not acted to raise or suspend the debt limit by early June, and potentially as early as June 1,” Yellen said in a letter to congressional leaders. Her previous letter dated May 15 use the term “likely” rather than “highly likely.”
On Sunday, Yellen told Chuck Todd of NBC’s “Meet the Press” that she views June 1 as a hard deadline for Congress to address the debt ceiling. “We expect to be unable to pay all of our bills in early June, and possibly as soon as June 1st,” she said. “The odds of reaching June 15th while being able to pay all of our bills is quite low.”
Last week, analysts at Goldman Sachs estimated that the cash balance at the Treasury could drop below $30 billion on June 8 or 9. While there is no official minimum balance, it’s generally believed that the Treasury seeks to maintain at least $25 billion to $30 billion in its general account to ensure that a default does not occur.
As of the close of business on Friday, the Treasury’s cash balance stood at roughly $60 billion.