The U.S. Treasury made no changes to its borrowing plans on Wednesday but said if Congress is unable to raise the country's borrowing cap before August, the department will be forced to delay or reduce future offerings.
As planned, Treasury will sell $72 billion in bonds and notes that will bring the United States to the edge of its $14.294 trillion borrowing cap on May 16.
Treasury will start to employ a series of emergency measures this month to allow the government to meet its obligations, such as paying interest on U.S. debt.
The measures and higher-than-expected tax receipts gives Congress until around Aug. 2 to broker a deal to raise the debt ceiling, the Treasury has said.
Although the payments from American taxpayers give the Treasury more room to fund government operations, the Treasury did not want to spook markets by changing the April-June quarter's auction sizes. Treasury officials said this would have been highly disruptive.
Congress is divided over how to raise the debt ceiling, with Republicans and some Democrats refusing to do so without slashing the country's $1.4 trillion budget deficit and changes to government spending.
Meanwhile, two top Republicans called on Obama to specify his pending request to increase the debt limit, saying it was vital to the bipartisan deficit-reduction group headed by Vice President Joe Biden.
"We believe a detailed proposal from the president will be the key to the success of the working group," Assistant Senate Republican Leader Jon Kyl and House Republican Leader Eric Cantor wrote in a letter to Biden.
Meanwhile, a closely watched group of six Republican and Democratic senators that is trying to forge a deficit-reduction deal has called off its meetings for the rest of the week due to the absence of a member.
Senator Tom Coburn, one of the three Republican members of the "Gang of Six," had to leave town for a family emergency and won't return until next week, according to an aide.
Treasury officials from the secretary to the department's debt managers believe Congress will reach a deal. In a sign of that confidence, Treasury's top debt manager, Mary Miller, said she expects coupon auction sizes to "remain steady in the upcoming quarter."
Treasury's debt advisory panel, which includes executives from JPMorgan Chase, Goldman Sachs and Soros Fund Management, also voiced confidence that Congress would raise the limit in a timely fashion, Treasury officials said.
Nevertheless, the government is taking precautionary measures.
"In the unlikely event that the debt limit is not increased by Aug. 2, some alterations to the auction schedule should be expected," Miller, Treasury's assistant secretary for financial markets, said in a statement.
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