“Based on the most recent data available to us, we believe that without an agreement beginning June 5, the Treasury Department will be unable to meet federal government needs,” US Treasury Secretary Janet Yellen wrote in a new statement Letter to Congress warning that the government could default on June 5 without raising the country’s $31.4 trillion debt ceiling.

Originally, this “red line” was set for June 1st. But negotiations are underway with the Republican majority in Congress to avert a default.

Yellen, in the letter to Republican House Speaker Kevin McCarthy, recalled that $130 billion in payments will be sent to veterans and people enrolled in Social Security and Medicare programs in the first two days of June. A move, the former Federal Reserve governor warned, will leave the Treasury Department in an “extremely precarious” position in terms of resource availability. Yellen therefore urged all interested parties to negotiate “in good faith” in order to reach a compromise agreement that would allow avoiding a default as soon as possible.