Treasury Extends Debt Deadline

The Hill reports:

The Treasury Department on Monday said it has extended the deadline for raising the federal debt ceiling to Aug. 2.

Treasury said it is beginning extraordinary maneuvers to keep the U.S. out of default in anticipation of Congress not raising the debt ceiling before it is breached on May 16.

Treasury Secretary Timothy Geithner told congressional leaders of the moves in a letter Monday.

He said that the actions will allow Treasury to extend its borrowing authority to Aug. 2. Last month, Geithner had estimated that Treasury could only stave off default only until July 8.

The change in the date gives Congress more time to negotiate a solution to the standoff over the $14.3 trillion debt ceiling. Most Democrats want a clean $2 trillion increase in the ceiling, while Republicans and Democratic fiscal hawks want the bill tied to deficit-reduction measures.