Fed Chair Powell Addresses US Debt Default and Inflation Concerns

Federal Reserve Chairman Jerome Powell has warned of “highly uncertain and adverse” economic consequences if the U.S. defaults on its debt obligations. Powell stressed that the Federal Reserve does not get involved in negotiations on this topic, stating: “We don’t give advice to either aside … We just would just point out that it’s very important that this be done.” As Democrats and Republicans remain deadlocked over raising the debt ceiling, Treasury Secretary Janet Yellen revealed this week that the Treasury Department will not be able to pay all of the government’s debt obligations “as early as June 1, if Congress does not raise or suspend the debt limit before that time.”