Biden-McCarthy Meeting Ends In Optimism But No Final Agreement On Debt Limit

US President Joe Biden and House Speaker Kevin McCarthy did not reach a final agreement debt ceiling during their meeting on Monday.

Each described the discussions as fruitful, with a pledge to continue negotiating to avoid a catastrophic failure for the US.

The Biden-McCarthy WH meeting took more than an hour, while White House negotiators returned to the Capitol for the same time.

Ahead of the talks, Treasury Secretary Janet Yellen warned that the department could run out of cash in early June, and that debt default could occur sooner than early June.

The tone tonight was better than ever. McCarthy said.

For his part, the US president said that default is no longer on the table. Bipartisan goodwill is the only way forward.

U.S. stock futures rose after McCarthy’s tone of talks speaking, while Treasury yields were little changed.

The current debt ceiling standoff has the potential to put more pressure on the US economy, which is already prone to recession after a series of interest rate increases from the Fed, according to Bloomberg Economics.

This raises a major tension for hardline Republicans, who want to increase the Pentagon’s budget at the expense of deeper cuts in social spending. McCarthy said defensive cuts should not be on the table.