US Treasury Liquid Cash Hits Six-Year Low Amid Debt Pressure

The cash stockpile of the United States Treasury has dwindled to its lowest point in six years, a level not seen since 2017, as the government grapples with rising public debt. Bloomberg reports that by the end of May the department held only a slim buffer of funds to cover obligations, signaling tighter liquidity for federal operations and potential challenges in debt servicing. By May 25, the Treasury carried just 38.8 billion dollars in cash available to meet immediate obligations, a stark contrast to the 140 billion held on May 12, illustrating a two‑week drain of over 101 billion dollars. This dramatic shift underscores how quickly short‑term cash balances can evaporate when spending and debt issuance outpace incoming receipts. The balance had fallen to 38.8 billion on May 25, the lowest since 2017, following 49.5 billion the previous day and a peak of 140 billion on May 12, according to the same data stream. These numbers highlight ongoing liquidity management pressures faced by the department amid sustained borrowing needs and evolving fiscal dynamics. In late May, a report cited by RIA Novosti, drawing on the White House Council of Economic Advisers, warned that a national debt default could trigger a substantial downturn in financial markets. The forecast suggested the stock market might fall by about 45 percent, with real GDP shrinking by roughly 6.1 percent and as many as 8.3 million jobs at risk. These projections emphasize the potential macroeconomic consequences of debt distress and the fragile balance between government financing costs and broader economic activity, a concern shared by policymakers and market participants in the United States and capably noted by major national and international observers. The implications extend beyond Wall Street, touching household budgets, credit conditions, and the timing of fiscal measures intended to stabilize financing needs while supporting economic growth. The discussions surrounding these scenarios reflect ongoing debates about debt management strategies, emergency liquidity planning, and the resilience of public finance in a high‑debt environment, with analysts cautioning that even moderate shifts in debt servicing costs can ripple through markets and public services.