CBO: June could be real deadline for debt hike

The real deadlline for raising the debt ceiling could be as late as June, the nonpartisan Congressional Budget Office said Wednesday. 

Currently, Treasury can issue new debt to continue to cover its bills through Feb. 7 under the October legislation that reopened the government after a 16-day shutdown. After that, Treasury can engage is “extraordinary measures” to avoid default.

“By CBO’s estimate, the Treasury might be unable to fully pay its obligations starting in March, but depending on the timing and magnitude of tax refunds and receipts in February, March, and April, the Treasury might be able to continue borrowing into May or early June,” CBO said in a new report.

The report notes that while Feburary and March tend to be lean months for the government, April is normally a surplus due to tax payments.

It remains unclear whether the next debt-ceiling dealine will bring another standoff likes the ones in 2011 and in October that shook the economy. House budget guru Rep. Paul Ryan (R-Wis.) told CEOs gathered at a The Wall Street Journal event on Tuesday that there will be no standoff next year over the debt celing.

Republicans suffered in the polls during the shutdown and a June date would put any fiscal standoff squarely in the mid-term election season.

The U.S. debt subject to the limit stands at $17 trillion.