Is US about to run out of cash? What market expert Ajay Bagga thinks

US debt ceiling news: In conversation with Zee Business Managing Editor Anil Singhvi, independent market expert Ajay Bagga said the US administration, in his view, is unlikely to default though there might be some nervousness in the markets. Remarks from Bagga come days after US Treasury Secretary Janet Yellen warned that the US may run out of cash by June 1 if Congress fails to address the issue by either raising or suspending the debt ceiling.

Currently, the Joe Biden administration in the US is approaching a debt ceiling, which means the government is unable to borrow any more funds. 

What Ajay Bagga tells Anil Singhvi on US debt ceiling 

"This will impact the market," said Bagga. The US may sustain till August and September, he said.

Some highlights on US debt ceiling crisis

First up, here are some things you need to know about the current situation in the US administration: 

• Currently, the ceiling stands at $31.4 trillion 
• Janet Yellen has pointed out a deadline as early as June 1 by which US must raise its debt ceiling or face a financial crisis
• The US Treasury Secretary has urged Congress to act "as soon as possible" to address the limit
• US President Joe Biden has called a meeting of congressional leaders on May 9 
• All in all, US debt ceiling has been revised as many as 78 times over a period of more than six decades
• The news comes at a time when regional US banks have posted massive declines after the failure of First Republic and the subsequent sale of its assets to JPMorgan Chase.

What is a debt ceiling?

A debt ceiling is the amount of money the US Treasury is authorised to borrow to pay its bills.

With inputs from Reuters

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