Here is the situation on Tuesday 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 federal credit default:
* The Democratic-led Senate and Republican-led House of Representatives plan to consider rival plans to reduce the deficit and raise the debt ceiling. Votes may come as early as Wednesday.
* International Monetary Fund chief Christine Lagarde urges United States to quickly resolve the stalemate, warning that failure to reach an agreement would have serious consequences for the world economy.
* President Barack Obama's top economic adviser, Gene Sperling, tells CNN he believes Republicans and Democrats could reach a budget deal this week with a minimum amount of compromise, a minimum amount of not 'my way or the highway'.
* New Washington Post-ABC News poll shows more than a third of Americans believe Obama's policies have made the U.S. economy worse, but they blame Republicans just as much.
* Republican members of the House of Representatives hold closed door meeting, to speak to reporters after meeting, around 1000 a.m. EDT (1400 GMT).
* Obama warns in a televised address on Monday evening that defaulting on U.S. debt obligations would be a reckless and irresponsible outcome to the stalemate. He calls for a fair compromise and says a temporary extension of the debt ceiling would not solve the problem.
* House Speaker John Boehner, the top Republican in Congress, follows Obama on TV. Boehner agrees the United States cannot default on its debt obligations. But Boehner says the American people will not accept an increase in the debt limit without significant spending cuts and reforms.
* Boehner offers a two-step plan to force spending cuts. A $1 trillion hike in the debt limit would be paired with $1.2 trillion in spending cuts. A second debt limit increase, to continue borrowing authority through 2012, would be linked to a tax code overhaul and spending cuts for Medicare and Medicaid health programs for the elderly and poor as well as other benefit programs. Federal spending caps would be put in place and Congress would be required to vote on a balanced budget amendment to the U.S. Constitution.
* Senate Majority Leader Harry Reid offers a competing plan 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, Medicare and Medicaid would be left untouched and there would be no tax increases, a key Republican demand. A congressional panel would be established to find further spending cuts.
* Boehner calls Reid's plan full of gimmicks. Obama supports Reid's plan.
* Investors watch developments in Washington closely but so far appear to have done little to prepare for default or a cut in United States' triple-A rating. Dollar falls across board Tuesday but stocks were mixed globally with focus on earnings.
(Reporting by Deborah Charles and Donna Smith; Editing by Sandra Maler and Jackie Frank)