Ceiling suspended: US takes on $300bn in new debt after hitting $16.7 trillion

America’s ticking debt bomb has been reset. Washington has suspended the debt ceiling, setting a date, and not a concrete dollar sum as a deadline, an unprecedented first in US history.

Citing ‘extraordinary measures’, the US Treasury has further delayed tackling America’s debt, and will wait until Labor Day, September 2nd, to revisit the burgeoning crisis. The ceiling has been lifted, and the Treasury has promised it will keep cash pumping into government spending programs beyond the debt limit through a series of emergency cash tools. 

Until then, the Treasury will borrow money to mend any gaps between government spending and revenues, adding to the already $16.7 trillion debt.

In the last four months, the US has accumulated $300 billion in debt. The Congressional Budget Office forecasts that the federal deficit will be $642 billion in FY13.