Obama confident over debt ceiling deal even as shutdown continues

Obama confident over debt ceiling deal
US President Barack Obama is confident that the lawmakers will be able to reach a budget deal before the deadline of raising borrowing limit expires later this month as the first US government shutdown in 17 years continues. "America has never not paid its bills. I don't expect to get there", Obama said in an interview with the Associated Press.

The government shutdown has now lasted for more than five days with the debt ceiling deadline nearing.The US government shutdown, which has idled as many as 800,000 federal employees, may cost the economy USD 300 million per day while chopping off 1.4 percentage points from Q4 US GDP.

US lawmakers failed to agree on the federal budget even with the country's government fast approaching the USD 16.7 trillion borrowing limit on October 17, 2013.

A failure to hike the debt limit may hit business and consumer confidence and cause havoc in global financial markets. America's credibility is at serious risk amid the political standoff and a default may lead to a cut in the country's credit rating.

However, hopes are rising that the shutdown may be resolved soon with the House Republicans and Senate Democrats under severe pressure to break the deadlock and save US from an unprecedented default.
House Speaker John Boehner has reportedly said that he will make sure that America does not default.

Dion Global Solutions Ltd.

Story first published: Monday, October 7, 2013, 9:13 [IST]
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