Treasury dips into pension funds to avoid debt limit

Reuters News

1/17/2012 3:34:15 PM - Reuters News

WASHINGTON (Reuters) - The Treasury on Tuesday started dipping into federal pension funds in order to give the Obama administration more credit to pay government bills.

Treasury started suspending reinvestments in a federal pension fund known as the G-Fund in order to avoid hitting the country's $15.194 trillion debt limit.

"I will be unable to invest fully" the federal employees retirement system fund, beginning Tuesday, Treasury Secretary Timothy Geithner told Democratic and Republican leaders in Congress.

The House of Representatives is expected to vote Wednesday on the Obama administration's request to increase the debt limit by $1.2 trillion.

(Reporting By Rachelle Younglai; Editing by Chizu Nomiyama)