US default probability low, but may impact Indian markets: Analysts

But if it does happen, it will be negative for all emerging markets as the US, simply put, would have run out of money

This week, Republican and Democrat lawmakers in the United States are likely to resume discussions with President Joe Biden to raise the country’s sovereign debt ceiling limit from the current $31.5 trillion.

June 1 is being seen as the date when the US will technically breach that ceiling, triggering a debt default by the world’s largest economy, unless the Biden administration comes up with a plan on budget priorities and on raising the debt limit.

While the probability of a default is still low, it cannot be discounted completely, and will impact all emerging economies, including debt, equity, and foreign