Treasury Could Use "Emergency Tools" To Keep Borrowing in Early 2013

Expects to hit debt limit before the start of the new year

(Reuters)—The Treasury said on Wednesday it was still on track to hit the debt limit near the end of the year though emergency tools would allow the department to continue borrowing funds to keep the government operating through early 2013.

As of Monday, the Treasury was $235 billion below the $16.4 trillion legal amount the government is allowed to borrow. The Treasury did not provide details on when the emergency tools would run their course, but analysts have forecast this to happen in the latter half of February.

This gives the Obama administration some breathing room to broker a deal with Congress to find a solution to the so-called fiscal cliff or the $600 billion in tax increases and spending cuts that are due to kick in at the end of the year.