The agreement would only set out the general lines of spending, leaving lawmakers to fill in the blanks in the coming weeks and months. The total amount of military spending would be specified, which would be a key sticking point in the talks, according to a source.
According to Democratic lawmaker Mark Takano, Biden has resisted Republican proposals to toughen labor requirements for anti-poverty programs and relax oil and gas drilling rules.
Congressman Kevin Hern, who leads the powerful Republican Studies Committee, told Reuters a deal was likely by Friday afternoon.
A default could rock global financial markets and push the United States into recession.
Credit ratings agency DBRS Morningstar put the United States under review for a possible downgrade on Thursday, echoing similar warnings from Fitch, Moody’s and Scope Ratings. Another agency, S&P Global, downgraded US debt after a similar situation in 2011.
The standoff, which has lasted for months, has spooked Wall Street, weighing on stocks and raising the cost of borrowing for the country.
Treasury Undersecretary Wally Adeyemo said concern over the debt ceiling had raised the government’s interest cost by $80 million to date.
Lawmakers regularly need to raise the self-imposed debt limit to cover the cost of spending and the tax cuts they have already passed.
House lawmakers will have three days to read any debt ceiling bill before having to vote on it. In the Senate, Republican Mike Lee said he would block a quick vote if he doesn’t like the deal, which could delay action for days.
With information from AFP