Treasury Dept. Postpones Two Auctions : Securities: Rubin says lack of action on raising the federal debt limit necessitated the move.

Maneuvering to avoid a looming debt-limit crisis, the Treasury Department on Monday postponed $31.5 billion in borrowing it had scheduled for this week.

The decision to postpone the Treasury auctions planned for today and Wednesday was the latest development in an intensifying dispute between Congress and the White House over the $4.9-trillion debt limit, which has become entangled in budget politicking.

Officials say the government can meet cash obligations until the middle of the month, when huge interest expenses could create a financial crisis unless Congress grants authority to borrow further.

“These postponements are necessary because Congress has not completed action on legislation to increase the statutory debt limit,” the Treasury Department said in a brief statement.

Treasury Secretary Robert E. Rubin, who was in Israel on Monday for the funeral of Prime Minister Yitzhak Rabin, approved the postponement after several telephone calls with aides, a spokesman said.

U.S. investors widely expect a political deal that will avoid a federal government default, but foreign observers have been more worried. These concerns were reflected in the currency markets Monday, where the dollar fell against the Japanese yen, German mark and other currencies.

The U.S. government is now operating within a hair’s breadth--$2 billion--of the legal debt ceiling, and it is projected to remain in that zone all week.

Budget experts said Monday that the real danger of a government default will not be encountered until Nov. 15, when the Treasury will owe $24.8 billion in interest on previously issued securities.

“It’s gamesmanship up until the 15th of the month,” said Martha Phillips, executive director of the anti-deficit Concord Coalition, referring to the political rhetoric over the debt limit. “And then it gets pretty serious.”

Senate Majority Leader Bob Dole (R-Kan.) said Sunday that he believes Congress will raise the debt ceiling. “It will be lifted,” he said on NBC’s “Meet the Press.”

Nonetheless, that outcome has been in question so far because of GOP proposals to link a higher ceiling with other policy changes.

For example, Republicans have talked about including measures to abolish the Commerce Department, overhaul the welfare system and restrict abortion on a proposed bill to increase the debt limit. White House officials have said repeatedly that the issues of how to balance the budget and whether to raise the debt ceiling should be kept separate, and President Clinton has threatened to veto any legislation that comes with strings attached.

Republicans and the Administration have also sparred over how a U.S. default would affect the financial system. Some Republicans have maintained that it would pose little risk, because financial markets would recognize that the default was the byproduct of a far-reaching effort to balance the budget for the first time in years. Rubin and other officials, however, maintain that a default would have grave long-term consequences. Most mainstream investors share that view.

Monday’s move was designed to relieve some of the pressure. The auctions that were postponed--$18 billion in three-year notes today and $13.5 billion in 10-year notes Wednesday--would have been settled Nov. 15, requiring $31.5 billion in payments.