WASHINGTON: President Barack Obama called top congressional leaders to the White House on Monday to demand they stave off the threat of a “devastating” US debt default that would rock the global economy.

Obama will meet top Republican and Democratic Party chieftains at the White House at 1900 GMT to push for Congress to raise America's borrowing authority before a Thursday deadline and to reopen the US government, now partially shuttered for two weeks.

The meeting comes as hopes rise for progress after Democratic Senate Majority leader Harry Reid predicted a deal was getting “closer” though time was fast running short.

Despite massive stakes for Washington and the world, there was still no clear indication whether a compromise could encompass competing power centers on either side of the deepest rift yet between Obama and his Republican rivals on Capitol Hill.

Obama was to meet with Republicans, House Speaker John Boehner and Senate minority boss Mitch McConnell, and Senate Democratic leader Harry Reid and the party's House minority leader Nancy Pelosi.

“If Republicans aren't willing to set aside their partisan concerns in order to do what's right for the country, we stand a good chance of defaulting and defaulting could have a potentially have a devastating affect on our economy,” Obama said.

During a visit to an anti-poverty charity in Washington, Obama said he would tell the leaders to “open the government and urge them to make sure that the United States government is paying it's bills.”

He said the impasse could be solved “today” if Republicans, whom he sees as the main obstacle to a deal, cooperate.

If Congress does not raise the $16.7 trillion debt ceiling by Thursday, the US government will begin to run out of money and could start defaulting on its obligations.

Initiatives in both the House of Representatives and the Senate stalled over the weekend.

The Politico news organization however reported Monday, however, that Reid had offered a compromise plan to McConnell.

The initiative would raise the debt ceiling for six to nine months and the government would be reopened until mid-to-late December.

The proposal would launch long-term budget talks between Democrats and Republicans, and could include a delay of a medical device tax used to help pay for Obama's health care reform law.

Reid did not confirm the terms of a deal but told reporters “we're working on everything.

“We're getting closer,” he said.

Should the Democratic-led Senate coalesce on a deal, the question would then become could Boehner secure sufficient support from his restive conservative coalition in the House to send it to Obama's desk?

The uncertainty was mirrored on Wall Street. Increasing concern over the fiscal showdown pulled the Dow Jones Industrial Average down early on, but amid talk of negotiations on Capitol Hill it had recouped most of its losses by midday trade.

Republican Senator Roger Wicker told MSNBC he was hopeful of seeing “something meaningful by the end of the day” from the Senate talks.

“There are sweet spots that Republicans and Democrats agree on,” he said.

Around the world, however, signs of alarm were mounting.

China and Japan, which between them hold more than $2.4 trillion of US debt, have urged Washington to get its house in order.China's foreign ministry spokeswoman Hua Chunying took a chance in Beijing to wag its finger at Washington.

“The United States is the largest economy in the world and we hope that it can show its responsibility,” Hua told reporters.

Bank of France Governor Christian Noyer warned of dire consequences if there was no solution.

A default would be “a thunderbolt on the financial markets” that would set off “extremely violent and profound turbulence worldwide,” he told the daily Le Figaro.

In Asia, markets in Sydney, Seoul and Singapore were down in part over the deadlocked talks. Tokyo, Hong Kong and Jakarta were closed for public holidays.

On Asian currency markets the dollar weakened, buying 98.25 yen against 98.59 yen in New York late Friday.

“So far, markets have not panicked because both parties have come out to reassure that they are working towards a compromise after every failed vote, keeping alive hopes for a last-minute deal,” Singapore-based DBS Bank said in a note.

US Treasury Secretary Jacob Lew earlier told the International Monetary Fund that Washington understood its reputationas a safe harbor was at risk.