The US Congress has adjourned for the weekend without reaching a deal to avert steep automatic budget cuts.
The cuts, worth $85bn (£56bn), are due to take effect on Friday. Democrats and Republicans are blaming each other for the deadlock.
President Barack Obama has invited congressional leaders to the White House for negotiations.
Mr Obama warned that the cuts will harm the economy. The IMF said they could have a global impact on growth.
On Thursday budget bills from both parties were defeated in the Senate.http://www.bbc.co.uk/news/world-us-canada-21610813
The pattern of leaving things to the last minute is well set in US politics and historically some sort of deal is usually, eventually, cobbled together. Markets seem quite relaxed thus far about the lack of agreement, but as everyone knows this can quickly change. It's possible that what we are seeing is a calm before the storm and that markets at some stage will use any US budget impasse to sell off and correct the impressive bullish run of the last 2-3 months. Markets may want to give the politicians a reminder of their power at some stage if no decision is forthcoming, so we all should be ready for at least the possibility of a wild ride in the markets going forward.
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