US House Passes Debt Ceiling Bill in Efforts to Avert Default

US House

The US House of Representatives approved a bill to temporarily stop enforcing the debt limit. If passed, the bill would extend the deadline for the country’s debt ceiling until January 1, 2025.

Five days before the Treasury’s deadline, the US House of Representatives voted decisively on Wednesday to increase the federal debt ceiling. With support from both Democrats and Republicans, the bill to temporarily suspend the $31.4 trillion debt limit was successfully passed. This action aims to overcome opposition from strong conservative factions and avoid a disastrous default.

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The report states that House Speaker Kevin McCarthy and President Joe Biden reached an agreement on the debt ceiling deal. This means that Congress is now on the path to authorize more borrowing just a few days before the government is projected to exhaust its funds for paying bills. The urgency stems from concerns about a potential recession.

The House, which is controlled by Republicans, voted overwhelmingly in favor of sending the bill to the Senate. The vote count was 314 in favor and 117 against. The Senate now has until Monday to pass the US debt ceiling bill and send it to President Joe Biden. If approved, the bill would extend the country’s debt limit until January 1, 2025.

The bill also met the Republican Party’s request to decrease spending on nondefense discretionary items for the next two years. As per the nonpartisan Congressional Budget Office, the suggested spending limits for 2024 and 2025 would lead to a reduction of around $1.5 trillion in expected federal budget deficits over the next ten years.

Also Read This Related: US House Committees Plan to Hold Hearings Together to Discuss Digital Asset Regulations

In addition, as US lawmakers worked quickly to prevent a severe financial crisis and stabilize the country’s economy, the BRICS countries (Brazil, Russia, India, China, and South Africa) made an announcement. They stated their intention to introduce a new currency for international trade, aiming to challenge the dominance of the US dollar.

Important: This article is intended solely for informational purposes. It should not be considered or relied upon as legal, tax, investment, financial, or any other form of advice.

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