Washington: If Congress fails to extend the debt ceiling, the US Treasury Department would most certainly run out of cash by the end of December, the nonpartisan Congressional Budget Office (CBO) has said.

The US Treasury has now surpassed the new debt ceiling of USD28.9 trillion, meaning it has no room to borrow under normal operating procedures, the Federal agency stated in a report on Tuesday, adding that the department is utilising "exceptional measures" to continue borrowing for a limited time.

The CBO anticipated that if the debt ceiling stayed unchanged and the US Treasury transferred USD118 billion to the Highway Trust Fund on December 15, as planned, the Treasury would run out of funds before the end of the month. "If that happens, the government will be unable to meet its obligations in full, delaying payments for some activities, defaulting on its debt obligations, or both," the Federal agency stated.

The CBO's forecast comes as US Treasury Secretary Janet Yellen urged Congress to lift the debt ceiling by December 15 to avoid default. "I cannot emphasise how important it is for Congress to handle this issue. The United States of America must pay its payments on schedule and in full. We will destroy our current recovery if we do not do so "On Tuesday, Yellen testified before the Senate Banking Committee.

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