U.S. Faces Potential Debt Default as Early as August, CBO Warns

Treasury's extraordinary measures may be exhausted by late May or June, intensifying pressure on Congress to act swiftly.

The Congressional Budget Office (CBO) projects the U.S. could default on its debt by August or September 2025 if Congress does not raise or suspend the debt ceiling.
Extraordinary measures currently being used by the Treasury Department may run out as early as late May or June if borrowing needs exceed projections.
The national debt has surpassed $36 trillion, with the debt ceiling reinstated at $36.1 trillion in January 2025 after its suspension in 2023.
Congressional Republicans are exploring budget reconciliation to address the debt ceiling but face internal disagreements and partisan divides over fiscal priorities.
Treasury Secretary Scott Bessent has urged prompt congressional action to avoid severe economic consequences, including market disruptions and delayed payments.