US edges closer to budget accord

A TOP Republican floated a tax compromise last night that could revive hopes for a budget deal, as President Barack Obama warned the US could spiral back into recession if a deal is not reached soon.

Eric Cantor, the number two official in the House of Representatives, said his party could agree to close some tax breaks as part of a budget agreement.

Republicans have also tentatively agreed to $150bn-$200bn in increased revenues, senator Jon Kyl said.