The U.S. Congressional Budget Office (CBO) sees "significant risk" about the government's debt obligations in the first half of June amid the debt limit crisis.

The non-partisan federal agency said it projects "if the debt limit remains unchanged, there is a significant risk that at some point in the first two weeks of June, the government will no longer be able to pay all of its obligations."

"The extent to which the Treasury will be able to fund the government’s ongoing operations will remain uncertain throughout May, even if the Treasury ultimately runs out of funds in early June," it said in its report titled Federal Debt and the Statutory Limit.

The CBO warned that if the debt limit is not raised or suspended before the Treasury’s cash and extraordinary measures are exhausted, the U.S. government will have to delay making payments for some activities, default on its debt obligations, or both.

President Joe Biden and Treasury Secretary Janet Yellen in recent months both urged Congress to take swift action to raise the debt limit in order to avoid the US defaulting on its debt obligations.

"America is not a deadbeat nation. We pay our bills... This nation has never defaulted on its debt. It never will," Biden told reporters at the White House on Tuesday after his meeting with congressional leaders.

Yellen said Sunday that Congress's failure to raise the nation's debt limit could lead to defaulting on its debt and may cause "calamity" for the world's biggest economy, adding "It’s widely agreed that financial and economic chaos would ensue."