Yellen tells Congress US expected to hit debt limit Thursday

Treasury Secretary Janet Yellen notified Congress on Friday that the U.S. is projected to reach its debt limit on Thursday and will then resort to “extraordinary measures” to avoid default.

In a letter to House and Senate leaders, Yellen said her actions will buy time until Congress can pass legislation that will either raise the nation’s $31.4 trillion borrowing authority or suspend it again for a period of time— but said it’s “critical that Congress act in a timely manner.”

“Failure to meet the government’s obligations would cause irreparable harm to the U.S. economy, the livelihoods of all Americans, and global financial stability,” she said.

“In the past, even threats that the U.S. government might fail to meet its obligations have caused real harms, including the only credit rating downgrade in the history of our nation in 2011,” she said. Yellen was referring to the debt ceiling impasse during Barack Obama’s presidency, when Republicans had also just won a House majority.