Yellen Warns Congress of Looming Debt Ceiling Crisis by Mid-January

The Treasury Secretary urges immediate action to avoid default as the U.S. approaches its borrowing limit after January 1.

Treasury Secretary Janet Yellen informed Congress that the U.S. will hit its debt ceiling between January 14 and January 23, requiring 'extraordinary measures' to prevent default.
The debt limit, suspended in 2023 under the Fiscal Responsibility Act, will be reinstated on January 1, 2025, with the federal debt currently standing at $36 trillion.
Extraordinary measures, such as reallocating federal funds, are temporary solutions that could delay default but require swift legislative action to ensure long-term stability.
President-elect Donald Trump has advocated for abolishing the debt ceiling entirely, a position that aligns with some Democrats but faces resistance from fiscal conservatives.
Failure to raise or suspend the debt ceiling could disrupt Social Security, Medicare, and military payments, and potentially trigger a financial crisis with global repercussions.