US Debt ceiling

The US has hit a limit on its borrowing. The maximum amount it could borrow is known as the debt ceiling. Janet Yellen, who is the treasury Secretary has said the US could default as soon as June unless the debt ceiling is raised. The Congress is currently debating the ways through which the current limit which is $31.4trillion in borrowing could be extended. Defaulting on the borrowing could have amplifying effects all over the economy as people could lose faith in the USD which is still the reserve currency for many nations. This comes in at an interesting timing when the US Consumer is piling up on Credit card debt and the US regional banks are facing an exodus of deposits.