Uncertainty prevails over raising US borrowing limit

Washington: US on Sunday appeared to be heading for a deep economic crisis as lawmakers failed to reach a consensus on increasing the nation`s USD 14.3 trillion debt limit.

Fast running out of time, leaders of both Democratic and Republican parties and the White House were scrambling to reach a consensus so that President Barack Obama could sign the legislation to increase the debt limit before the Treasury runs out of money to pay its bill on August 2.

However, till late yesterday, there appeared to be no indication of a compromise as top leaders from both the Republican and Democratic parties were blaming each other in the public.

While the Republicans have the majority in the House of Representatives, the Democrats have the majority in the Senate.

Both the Chambers of the US Congress, the House of Representatives and the Senate must pass identical bills on the debt ceiling before it could be sent to the White House for Obama to sign that into law.

But that has not been the case so far.

Yesterday, the House of Representatives rejected by 173-247 votes a debt-ceiling plan from the Senate Majority Leader, Harry Reid.

Following which leaders from both the parties went public blasting each other.

Late in the evening, Obama too meet Reid and the House Democratic leader Nancy Pelosi.