These discussions may seem futile. Indeed, all observers seem to agree on one point: no one (not even the Republicans) wants to let the United States default in June. The explosion would be too great. The plausible pattern would therefore be, by the end of the weekend, that of an agreement on raising the ceiling until 2025. The stumbling blocks would then lie more in the details of allocation: how to categorize or compensate for certain expenses, whether to reduce the funds allocated to energy infrastructure, etc.

This tug-of-war highlights the power of the opposition party, and certain differences within the Democratic Party itself. So much so that Joe Biden, who was visiting Japan, decided to cut short his stay to support his camp and unite his troops. There's no easy answer to this issue. Perhaps Chat GPT, the artificial intelligence robot, has the answer?

 

Drawing by Amandine Victor for MarketScreener