WASHINGTON: President Barack Obama will hold a press conference Wednesday amid a dramatic showdown between his administration and Congress to avoid a US debt default, his office said.

It will be held at 11:30 am (1530 GMT) in the building's ceremonial East Room, the White House said in the president's daily schedule.

Obama met the top Democrat in the Senate and his minority Republican counterpart on Monday, seeking to unpick a deadlock over his call on lawmakers to lift the dollar 14.29 trillion debt ceiling by an August 2 deadline.

He will again meet with Democratic Senate Majority Leader Harry Reid following the press conference, according to the official schedule, along with other Senate Democratic leaders.

As political tensions rose, the White House warned of “calamitous” consequences to the global economy if the talks do not seal an agreement and Washington is forced into default and runs out of money to pay its bills.

It accused Obama's Republican foes of siding with billionaires and private jet owners, and challenged the lawmakers to take on “some of their sacred cows.” But Republicans, who quit talks with the White House last week accusing Obama of pushing tax hikes, again demanded big spending cuts in return for agreeing to lift the debt limit.

In the United States, Congress has to agree to lift the cap on government borrowing, and has done so repeatedly in recent years at the urging of successive Democratic and Republican presidents.

But this time, congressional Republicans elected in a backlash against government and on a platform of sweeping spending cuts in last November's mid-term polls, are demanding big concessions from the White House.

The White House says Republican budget plans would place the very survival of popular social entitlement programs like Medicare health plans for the elderly at risk.

Republicans claim Obama is motivated by preserving big government programs and wants tax increases which would harm the economy. They are demanding large cuts to the annual deficit, projected to hit dollar 1.6 trillion this year.

The US government hit its legal borrowing limit on May 16 and successions of meetings chaired by Vice President Joe Biden were designed to secure congressional approval to raise the ceiling.

The Treasury, which has performed a number of intricate financial measures since then, says it will run out of maneuvering room on August 2.

Financial rating agencies have warned of a possible downgrade of the top US debt rating without an increase in the debt ceiling.