The US government will run out of money at some point in October unless Congress acts to increase the federal borrowing limit, Treasury Secretary Janet Yellen said on Wednesday.

Congress suspended the debt limit in 2019, but the two-year suspension lapsed on July 31, resetting the cap at $28 trillion and forcing Treasury to begun taking "extraordinary measures" to continue funding government operations without breaching the limit.

In a letter to House Speaker Nancy Pelosi, Yellen warned that if the ceiling was not raised, "the United States of America would be unable to meet its obligations for the first time in our history."

"Based on our best and most recent information, the most likely outcome is that cash and extraordinary measures will be exhausted during the month of October," she wrote.