House will reach a deal to avoid government shutdown - McCarthy

The top Republican in the US House of Representatives has said he is optimistic a last-minute deal will be reached to avert a government shutdown.

"At the end of the day, we will get this done," House Speaker Kevin McCarthy told CNBC on Thursday.

The deadline for Congress to pass a new budget to keep funding government agencies is midnight on Saturday.

Hundreds of thousands will be placed on unpaid leave and some key agencies will stop operating without a deal.

"I wake up every day optimistic," Mr McCarthy, 58, said when asked about the odds of a deal being reached. "I'd say put your money on me. We will get this done."

The likelihood of a shutdown, however, appeared to increase on Thursday as the Senate and the House continued to pursue conflicting funding plans.

The Senate will hold a procedural vote on a short-term funding bill that has bipartisan support in the chamber. The bill would avoid a government shutdown until 17 November, giving Congress more time to reach a deal on a longer-term budget.

But for that bill to become law it would have to pass in the House, where at least nine hardline members of Mr McCarthy's narrow Republican majority are refusing to support any stopgap measure.

That group has repeatedly threatened to remove Mr McCarthy as House Speaker if he relies on Democratic votes to work around their opposition and pass a funding bill without them.

"I think that the Speaker is making a choice between the speakership and American interests," President Joe Biden said on Wednesday.

"This is not an impossible puzzle to solve," Democratic Senate Majority Leader Chuck Schumer said. "Speaker McCarthy needs to stop letting the Maga radicals drive his decisions."

The House, meanwhile, is expected to hold its own votes on Friday on short-term spending bills that are considered unlikely ever to pass in the Senate.

Mr McCarthy has not committed to bringing the Senate's short-term funding bill to the House floor, but said a shutdown could be avoided if Democrats better addressed the issue of border security in that bill.

"We're trying to work to see, could we put some border provisions in that current Senate bill that would actually make things a lot better," he told reporters on Thursday.

"I talked this morning to some Democratic senators over there that are more aligned with what we want to do. They want to do something about the border."

In recent months, Mr McCarthy has seen a growing ideological gulf between the moderate and right wings of his caucus.

That right-wing flank only accounts for a handful of members, but in a chamber that Republicans control by only nine seats they hold an out-sized power over proceedings.

Fiercely opposed to anything that resembles business as usual in Washington, they demand that the party deliver on spending cuts and what they call conservative priorities.

That means Mr McCarthy may need to look to the opposing party to bail him out and support a short-term spending bill.

Working with Democrats is all but assured to trigger a so-called motion to vacate, the first step in forcing a vote to oust him as Speaker.