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Joe Biden and the House Republican speaker, Kevin McCarthy, have reportedly reached a deal in principle to raise the debt ceiling, with just days left before America was expected to default.
Negotiators reached the deal on Saturday, a source familiar with the negotiations told the Reuters news agency.
Biden and McCarthy held a 90-minute phone call earlier on Saturday evening to discuss the deal.
The deal still needs to receive approval from the divided Congress, and McCarthy will probably need some support from Democratic members to get the proposal through the House, given Republicans’ narrow majority in the lower chamber.
The news comes just over a week before the US government would run short of funds to pay all its bills, after the deadline was pushed back to 5 June.
Economists predicted a default would trigger disastrous consequences for the US economy and global markets, resulting in millions of jobs lost and a significant reduction in America’s gross domestic product.
More details soon …