US Senate passes debt limit deal to avert default

Nepal Views

Kathmandu: The US Congress has approved a deal to lift the country’s borrowing limit, days before the world’s largest economy is due to default on its debt.

A default would limit the government’s ability to borrow more money or pay all of its bills. It would also threaten to wreak havoc overseas, affecting prices and mortgage rates in other countries.

In Thursday night’s session, the bill passed with support from 44 Democrats and 17 Republicans, plus two independents. Sixty votes were required to approve the measure in a 100-seat chamber that Democrats only narrowly control.

Thirty-one Republicans were opposed, including a member of the party’s leadership in the chamber, John Barrasso. Among the four Democrats who voted against were left-wing senators Bernie Sanders, John Fetterman and Elizabeth Warren.

The House earlier this week already passed the measure, which can now be sent to President Joe Biden to be signed into law. Biden, just moments after the Senate passed the debt limit bill, praised Congress for its efforts and said in a statement, ‘I look forward to signing this bill into law as soon as possible.’

The president will deliver an address to the nation on Friday on averting default. His signature on the bill will spare the US from a catastrophic default on its $31.4tn (£25tn) debt.

The US is forecast to overshoot its current debt ceiling on Monday 5 June.