Last-ditch attempts to avert US fiscal default

Congressional negotiations to end a US fiscal crisis gripping Washington and spooking financial markets hung by a thread last night after bipartisan talks broke down in the House of Representatives and shifted to Senate leaders.

Senate majority leader Harry Reid, a Democrat, held an initial session with Senate Republican leader Mitch McConnell. But uncertainty remained about their ability to reach an agreement quickly to end a partial government shutdown and increase the nation’s borrowing authority.

Thursday is the deadline for raising the debt ceiling, necessary to avoid a possible government default. The Senate was set to meet yesterday, but the House of Representatives was not, so Congress will be cutting it close.