If America defaults, 70 lakh people will lose their jobs

- 10 lakh crores of people's wealth will be washed away: Moody's warning

- Unemployment rate will increase to eight percent: GDP will decrease by four percent: Stock market will see a decrease of 20 percent.

- Rating agency Fitch has also hinted at downgrading America's credit rating, putting the AAA rating on negative watch.

- Biden's troubles increased as Republican lawmakers headed out of Washington for the weekend

Washington: America, the world's most powerful country, has come close to defaulting for the first time in its history. Janet Yellen, the finance minister of the country, has warned that if the debt limit is not increased by June 1, the US may default. If America defaults, there will be dire consequences.

According to Moody's Analytics, if the US defaults, 7 million people will lose their jobs in the country. The unemployment rate will skyrocket to eight percent. GDP will decrease by four percent. A 20 percent decline will be seen in the stock market. People's wealth of 10 lakh crores of dollars will be washed away.

This warning was given in a report prepared under the leadership of Moody's Chief Economist Mark Zandi. However, American President Biden has expressed hope that an agreement will be reached on the debt ceiling. The Biden administration is holding daily talks with Republican lawmakers on the issue.

The debt ceiling is $31.4 trillion. The debt limit is the limit for how much the federal government can borrow. Since 1960, this limit has been increased 78 times. Finally, in December, 2021, this limit was increased to 31.4 trillion dollars.

On the other hand, rating agency Fitch has put America's AAA rating on negative watch. Along with this, the credit rating has also been indicated to be downgraded. However, Fitch expressed hope that a political consensus would be reached and the debt ceiling would be raised. Meanwhile, the Biden administration has been trying to convince Republican lawmakers to approve raising the debt ceiling in order to prevent the US from defaulting. However, with Republican lawmakers heading out of Washington for the weekend, the Biden administration's difficulty has increased because the US could default if no agreement is reached by June 1.

When lawmakers return after the weekend, Biden will have two or three days to convince them.

It is worth mentioning that Republican lawmakers have been saying for a long time that they will approve the proposal to increase the debt limit only if the Biden government cuts spending.

Germany was pushed into recession as the economic growth rate continued to decline

- Energy crisis in Germany after the Russia-Ukraine war led to a sharp increase in inflation

Economic growth (GDP) in Germany, Europe's largest economy, has been negative for two consecutive quarters. After a negative economic growth rate of 0.50 percent in the last quarter of 2022, Germany's GDP fell by 0.30 percent in the March quarter of the current year, according to the figures of the German Statistics Office.

If the economic growth rate of a country remains negative for two consecutive quarters, that situation is considered as a recession in economic language. Germany has been facing an energy crisis for some time following Russia's invasion of Ukraine. Earlier, the economic growth rate was expected to be zero. Inflation rose in Germany as energy supplies from Russia stopped.

The recession is less severe than was anticipated when the war began. A German economist said in his statement that the recovery in demand after Corona was not enough to prevent the country from falling into recession.