US debt crisis: talks to avoid default make 'significant progress'

The White House and Republican leaders in Congress have made significant progress towards a deal to raise the US debt ceiling and avert a potentially catastrophic default, according to officials familiar with the talks.

Under a plan negotiated late on Saturday night, the ceiling would be raised in two steps by about $2.4tn (£1.5tn) and spending would be cut by a slightly larger amount, the officials said. The first stage – to raise the ceiling by about $1tn – would take place immediately and the second later in the year.
Congress would be required to vote on a balanced budget amendment to the constitution, but none of the debt limit rise would be contingent on its approval.

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