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Clinton 'Confident' U.S. Lawmakers Will Agree Debt Limit Deal

U.S. Secretary of State Hilary Clinton in Hong Kong
U.S. Secretary of State Hillary Clinton says she's "confident" rival U.S. lawmakers will be able to reach a deal to reduce the government deficit and raise the debt limit to prevent what would be an unprecedented U.S. default.

Clinton is quoted as making the statement in a speech to business leaders today in the Chinese territory of Hong Kong.

A debt deal in Congress is needed by August 2 -- or the U.S. government will not be able to pay its debts when the current $14.3 trillion borrowing limit expires next week.

Such an event, experts say, could lead to chaotic global economic repercussions. U.S. lawmakers had pledged to try to find a solution by July 24 -- before Asian markets opened on July 25 -- but officials said no breakthrough had been achieved.

The debate between President Barack Obama's Democrats and the rival Republicans has been focusing on how deeply to cut government spending on social programs and whether to increase taxes. Republicans have refused to support tax increases, while Democrats resist major spending cuts.

compiled from agency reports