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President Joe Biden declared the US “will not default” on its debt, boosting Wall Street stocks overnight.

The S&P gained more than one per cent. The NASDAQ and New York Stock Exchange increased almost 1.5 per cent. Australian shares are expected to follow this trend.

The United States is facing the prospect of defaulting on trillions of dollars worth of loans. The country is relying on Republicans and Democrats striking a deal to legally allow the US Department of Treasury to incur more debt and pay its bills.

US Treasury officials say if a deal isn’t made, the US could be at risk of running out of money to repay its debts as early as June – potentially triggering a recession.

The issue has seen Mr Biden pull out of Australia’s Quad meeting in Sydney next week. He has stated that defaulting on the debt “is not an option”.

Back home, labour force data is due to be released later this morning. The unemployment rate has been steady at near-50-year lows of 3.5 per cent.

The Aussie dollar has made slight gains. One Aussie dollar is buying 67 US cents and 53 British pence.

To commodities, and gold plunged to a seven-week low at under $1982.83 US dollars per ounce.     

Oil prices reversed losses, up nearly three per cent at $72.72 US dollars per barrel.

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