Washington policymakers may have some extra time in negotiating a deal to raise the debt ceiling.
A new Congressional Budget Office (CBO) report released on Friday said the date when the federal government would be unable to pay its bills in full and on time, known as the X-date, might come a few days or weeks after June 1, the date originally put forth by Treasury Secretary Janet Yellen.
"There is a significant risk that the Treasury will run out of funds at some point in the first two weeks of June," the nonpartisan CBO report said.
However, the report goes on to state that if the government is able to collect more tax revenue, it would extend the ability to pay its bills and meet its outstanding debt obligations. In other words, it would buy some time before the US hits the debt ceiling.
"If the Treasury’s cash and extraordinary measures are sufficient to finance the government until June 15, expected quarterly tax receipts and additional extraordinary measures will probably allow the government to continue financing operations through at least the end of July," the CBO authors wrote.
The Bipartisan Policy Center also released a report this week echoing CBO's findings. The report added that if there are more Americans who paid taxes this year than Yellen estimated, it could add to the government's "extraordinary measures" needed to continue to pay its bills.
"Absent Congressional action, BPC projects that the 'X Date'... is most likely to occur between early June and early August of 2023," the analysis said. "BPC now projects that if policymakers do not act on the debt limit, Treasury will most likely have insufficient cash to meet all its financial obligations sometime between early June and early August 2023."
Meanwhile, there is political pressure building on lawmakers over the debt limit brinksmanship.
Former President Donald Trump said at a CNN town hall earlier this week that Republicans should not raise the debt ceiling unless President Biden and Democrats agree to cut some government spending.
"I say to the Republicans out there — Congressmen, senators — if they don’t give you massive cuts, you’re going to have to do a default," Trump said at the CNN town hall.
During his administration, Trump approved raising or extending the debt ceiling three times. His comments drew criticism from some Republicans who maintained they'd like to see a deal met.