WASHINGTON (Reuters) - A grinding political battle over America's national debt led Washington on Thursday to postpone a regular auction of government debt, a reminder that the country once again is just weeks away from a potential default.
The Treasury Department said in a statement it would not hold an auction of 2-year notes originally scheduled for Oct. 27 because it might not be legally authorized to borrow money by the time the auction settles on Nov. 2.
The Treasury said it will still hold auctions for 5-year and 7-year notes next week even though they are also scheduled to settle on Nov. 2.
"Treasury believes that postponing the auction for the 2-year note poses less risk for market functioning than postponing the 5-year or 7-year note offering," the department said.
(Reporting by Jason Lange; Editing by Chizu Nomiyama)