Acting US Treasury chief deploys another debt ceiling cash management move

WASHINGTON, Jan 23 (Reuters) - The U.S. Treasury Department said on Thursday that it activated another of its extraordinary cash management measures to avoid breaching the federal debt limit, suspending daily reinvesments of the Government Securities Investment Fund, or G Fund.

The Treasury said the G Fund maneuver would claw back about $300 billion worth of federal borrowing capacity. Budget analysts say that Treasury extraordinary measures could put off a potential default scenario for several months without debt ceiling legislation from Congress.

David Lebryk, a career Treasury employee who is serving as acting Treasury secretary, said in a letter to congressional leaders that the move was made because the $36.1 trillion federal debt ceiling had not been raised or suspended.

Treasury on Tuesday began suspending investments in two government employee healthcare and retirement funds not required to pay immediate benefits.

Lebryk said the G Fund would be made whole once the debt limit is increased or suspended, and urged Congress "to act promptly to protect the full faith and credit of the United States."

The debt ceiling issue will present an early challenge to Trump's Treasury secretary nominee, Scott Bessent, who is awaiting a confirmation vote in the U.S. Senate, perhaps as soon as the weekend.

Bessent, a hedge fund manager, told his Senate confirmation hearing last week that the ceiling is a "nuanced convention" but if Trump wants to eliminate it, he would work with Congress and the White House to make that happen.