Borrowing limit showdown

Congress has until Aug. 2 to raise the federal borrowing limit or the government will run out of money.

• Thursday’s developments: The first, fragile signs emerge of a possible compromise: a proposal by the Senate’s top two leaders to give President Barack Obama enhanced authority to raise the debt limit.

• Markets react: J.P. Morgan’s CEO warned that a failure to raise the debt ceiling could mean “catastrophe” for the economy. Credit rating firm Standard & Poor’s warned an impasse could lead to a downgrade of the government’s credit rating.

• What’s next: Obama scheduled a news conference for 8 a.m. PDT today. The White House says talks will continue but has no plans to move them to the presidential retreat at Camp David.