Signs of Progress in Debt Talks Vote Scheduled Sunday

The U.S. Senate delayed until later on Sunday a key test vote on a Democratic plan to raise the country's debt limit as signs of progress emerged in negotiations to strike a deal to avert a damaging default.

Getty Images John Boehner (R)

With a Tuesday deadline looming to raise the government's $14.3 trillion borrowing limit , lawmakers are fighting against the clock to forge a bipartisan compromise agreement that can pass both the Democratic-controlled Senate and the House of Representatives, which Republicans lead.

The Senate had scheduled a 1 a.m. EDT test vote on Sunday on a debt limit and deficit reduction plan presented by Senate Majority Leader Harry Reid that Republicans said they opposed and could have blocked.

But Reid told the Senate late on Saturday night that the vote would now be held at 1 p.m. EDT on Sunday to give negotiators " as much time as possible" .

" There are negotiations going on at the White House now on a solution that will avert a catastrophic default on the nation's debt," Reid said.

" There is still a distance to go," he said.

WASHINGTON (MarketWatch) — A key vote in the Senate was put off until Sunday as lawmakers struggled to craft a compromise to raise the U.S. debt ceiling and avert a financial crisis.

Democrat Harry Reid of Nevada, the Senate majority leader, late Saturday called off a cloture vote that could have paved the way for another vote on his own plan to increase the debt limit. Reid revised his proposal after House Republicans rejected it.

Leaders of both parties huddled, negotiated and argued throughout Saturday on a number of proposals. At one point Republicans hinted that they were close to a compromise with President Obama.

Although Reid shot down the idea of an imminent agreement, negotiations were expected to continue late into the night and at least one news report suggested the two sides were close to an agreement.