US Treasury USA Will borrow $ 3 trillion in Q2 amid Covid-19 fallout

WASHINGTON: The United States Treasury Department said it plans to borrow around $ 3 trillion in the second quarter to support the economy through the COVID-19 pandemic.

The US Treasury USA It expects to borrow $ 2.99 trillion in private net commercial debt from April to June, assuming a cash balance at the end of June of $ 800 billion, the department said in a statement Monday, the Xinhua news agency reported.

The increase in private net negotiable loans is mainly due to the impact of the COVID-19 outbreak, including the expenses of the new legislation to help individuals and businesses, changes in tax revenues, including the postponement of individual taxes and trade from April to June through July, and an increase in the Treasury cash balance in late June, the department said.

The department also said it expects to borrow another $ 677 billion in the third quarter, with first-quarter loans totaling $ 477 billion.

The unprecedented debt came after the Commerce Department reported last week that the United States actually gross domestic product (GDP) in the first quarter contracted at an annual rate of 4.8% amid the consequences of COVID-19, the largest quarterly decline since the 2008 financial crisis.

"Due to the effects of the crisis and legislation enacted to combat it, debt and deficits will now grow much higher, to never-before-seen levels both in dollars and as a share of gross domestic product ," the Committee for a Responsible Federal Budget (CRFB), a nonpartisan watchdog group, said in a recent analysis.

United States budget deficits will total more than $ 3.8 trillion this year, and public debt will exceed the size of the economy by the end of fiscal year 2020, according to the CRFB.

From president Donald trump took office in 2017, the US national debt. USA it increased from less than $ 20 billion to more than $ 24 billion.