The International Monetary Fund (IMF) Chief Christine Lagarde has exerted pressure on the US to resolve its debt crisis, saying the probable default can shake the global status of the dollar.
"It would probably entail a decline of the dollar relative to other currencies, and probably doubts in the mind of those people who reserve currencies as to whether the dollar is effectively the ultimate and prime currency of reserve," she said in an interview with PBS television on Thursday, AFP reported.
With only a few days to an August 2 deadline when the Treasury says it will run out of funds, financial experts have also warned that the US default on its debt would likely raise doubts about the dollar's status as the world's prime reserve currency.
"To have a default or to have a significant downgrading of the United States signature would be a very very very serious event. Not for the United States alone, but for the global economy at large," Lagarde had said during a speech in New York on Tuesday.
Lagarde has repeatedly warned the US against the global consequences of a looming default since she became the managing director of the IMF on July 5, 2011.
The US debt ceiling is capped at USD 14.3 trillion, up from USD 10.6 trillion when President Barack Obama took office in 2009.
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