Here is what is happening on Monday as lawmakers try to close in on a deal to raise the $14.3 trillion U.S. debt limit by August 2 and avoid a credit default:

* The Democratic-led Senate and Republican-led House of Representatives consider rival plans this week to reduce the deficit and raise the debt ceiling.

* A plan being developed by Senate Majority Leader Harry Reid aims to raise the debt ceiling by $2.7 trillion, enough to cover the country's borrowing needs through the November 2012 elections. That would be paired with an equal amount of spending cuts over 10 years. The Social Security retirement program, the Medicare health insurance program for the elderly and disabled and the Medicaid health insurance program for the poor would be left untouched.

* A plan being developed by House Speaker John Boehner, the top Republican in Congress, involves a two-stage strategy. Congress would raise the debt limit by about $1 trillion before August 2, paired with a similar amount of spending cuts. Lawmakers would be given the task of writing a tax code overhaul and a plan to cut spending from Medicare, Medicaid and other benefit programs in order to win passage of a second increase in borrowing authority next year.

* Boehner plans to outline the proposal to his fellow Republicans at a closed-door session scheduled for 2 p.m. EDT.

* House Democrats plan a closed-door session to discuss the rival plans at a closed-door session scheduled for 5:30 p.m. EDT.

* Global financial markets react to discord in Washington over the debt limit. Stock prices fall and investors flee to safe-haven gold and Swiss francs.

* Secretary of State Hillary Clinton, in Hong Kong, seeks to reassure Asia that U.S. lawmakers will reach agreement and avoid a U.S. credit default. Asian investors hold $3 trillion in U.S. government debt. China and Japan hold the bulk of that debt. Clinton says she is confident U.S. lawmakers will avoid default.

(Reporting by Donna Smith)