Bloomberg writes, "Yellen Says Treasury to Hit New Debt Limit in Mid-​January." The article says, "Treasury Secretary Janet Yellen said her department is likely to begin taking special accounting maneuvers sometime in mid-​January to avoid breaching the US debt limit, and urged lawmakers to take action defending the '​full faith and credit' of the US. 'On Jan. 2, 2025, the new debt limit will be established at the amount of outstanding debt,' Yellen wrote in a letter on Friday to House Speaker Mike Johnson and other congressional leaders. The Treasury will be given a short reprieve, however, because outstanding debt is scheduled to decrease by $​54 billion on Jan. 2, thanks to the expected redemption of securities held by a federal trust fund." Bloomberg'​s piece explains, "The extra headroom is likely to be exhausted by Jan. 14 to 23, Yellen said. At that point, the Treasury will resort to special accounting maneuvers to help keep the government funded.... Goldman Sachs Group Inc. economist Alec Phillips wrote in a Dec. 21 note that the ultimate '​deadline for debt limit action is likely not until Jul.-​Aug. 2025.'" It adds, "Some strategists have anticipated an easier path to an agreement to suspend or lift the cap given Republicans' unified control of Congress. Yet last week, Trump failed to get a debt-​ceiling measure attached to the latest temporary federal spending bill when members of his own party shot down a House version that included a two-​year suspension. A showdown over the debt ceiling could strain financial markets and put upward pressure on already-​elevated US borrowing costs."

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