Republican negotiators announced Friday they halted negotiations with the White House to raise the US debt ceiling as the window to reach an agreement narrows.
"We've got to get movement by the White House and we don't have any movement yet so, yeah, we're in a pause," House Speaker Kevin McCarthy said on the Hill, according to multiple reports.
Talks over raising the $31.4 trillion debt ceiling, or the amount the US is legally allowed to borrow, have been ongoing for weeks as the US faces an early June deadline to do so or risk a default that would send major shockwaves through the global economy.
McCarthy has been the sole impediment to lifting the debt ceiling with what is called a "clean" bill, insisting instead that any effort to do so be paired with budget cuts.
US President Joe Biden and McCarthy have appointed chief negotiators to hammer out a deal, and both sides had sounded upbeat as late as Thursday, but appeared to have hit a standstill on Friday.
"Washington has to spend less. It's as simple as that," McCarthy said on Twitter amid the impasse.
Markets were downbeat amid the collapse in talks with the Dow down roughly a quarter of a percent after posting gains earlier in the morning.
Biden has already cut back a foreign trip to the Asia-Pacific region that was set to make him the first US president to visit Papua New Guinea. He will now return to Washington on Sunday to continue the talks with McCarthy and congressional leaders. Secretary of State Antony Blinken will visit Papua New Guinea in the president's stead.
The president said Wednesday he is "confident" his team and congressional leaders will strike a deal to ensure the country does not default on its national debt.
"Every leader in the room understands the consequences if we fail to pay our bills, and it would be catastrophic for the American economy and the American people if we didn't pay our bills," he told reporters before departing for the G-7 summit in Hiroshima.
