U.S.A.: House of Representatives passes debt limit extension
On 23 January 2013, the U.S. House of Representatives passed a bill to allow the federal government to continue borrowing money through mid-May.
The bill avoids an immediate threat of U.S. default by suspending limits on the government's ability to borrow until 19 May 2013. It does not specify a dollar amount for debt ceiling increase, but allows borrowing as needed to meet federal obligations that must be paid by that date.
According to comments, the measure avoids for the time being a repeat of the 2011 debt ceiling standoff that hit markets and resulted in a downgrade of the government's AAA credit rating. The U.S. Treasury is expected to exhaust remaining capacity under the USD 16.4 trillion debt limit between mid-February and early March.
The bill aims to draw Senate Democrats into the debate by requiring both chambers to pass a formal budget resolution by 15 April 2013. If either the House or the Senate fails to meet this deadline, lawmakers' pay will be suspended until a budget is passed.
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