House will not vote tonight on Boehner debt plan

Urgent efforts to avoid an unprecedented US debt default hit another snag on Thursday when some rebel Republican lawmakers refused to back a budget deficit plan proposed by their own congressional leaders.

After hours of trying to get enough votes, the Republicans who control the House of Representatives put off action for the night, further delaying any compromise with Democrats to stop the countdown toward the government running out of money to pay all of its bills from next Tuesday.

The delay resulted from House Speaker John Boehner's need for more time to try to overcome objections from conservative rebels in his own party.

It was not immediately clear what Boehner intended to do regarding the legislation or when a vote might be held.

He has been grappling with Republican lawmakers such as Mick Mulvaney, a supporter of the Tea Party movement that wants deeper spending cuts than Boehner has proposed.

"I'm still a no," Mulvaney said before the vote was canceled for the night.

Lawmakers must lift the government's $14.3 trillion borrowing limit by Tuesday or risk a devastating default and downgrade of the top-notch credit rating that helps make US debt a pillar of the global financial system.

Many US citizens are outraged that Washington cannot reach a deal after many weeks of polarized and acrimonious debate.

World markets, unnerved by the risk of a US default or downgrade, watched anxiously. The US stock market's broad S&P 500 index fell for a fourth day and interest rates soared on some Treasury bills that mature in August.

The dollar sunk to a fresh four-month low against the yen at 77.48 yen after the announcement that the House would not vote on Thursday evening.

Even with a deal to lift the debt limit, a downgrade of the US credit rating is likely unless a big dent is made in the deficit. A downgrade would raise US borrowing costs, hurting an already weak economy, and rattle global investors.

International Monetary Fund chief Christine Lagarde warned of the risks of Congress failing to raise the debt ceiling, which would mean the US government runs out of money to pay all of its bills after Aug. 2.

"One of the consequences could be a decline of the dollar as a reserve currency and a dent in people's confidence in the dollar," Lagarde told PBS NewsHour in an interview.

US financial executives added their voices to calls from the business community for Congress to strike a deal that would banish the specter of default.