US President Barack Obama has made a new offer to avoid the "fiscal cliff" as the pace of negotiations picks up. He has now proposed a tax rise on incomes over $400,000 (£247,000), well above the $250,000 level he had sought after the president and House of Representatives Speaker John Boehner met at the White House on Monday.

However, Boehner's said that the offer was "a step in the right direction" but not fully "balanced" and accept as much as $1 tn in new tax revenue over 10 years and would raise the debt ceiling to ensure the government is funded for a year. A deal must be reached by 1 January, or a combination of steep tax rises and sharp spending cuts will take effect. In exchange, it is reported that he would like the White House to agree to $1tn of spending cuts. Any debt limit increase would require cuts and reforms of a greater amount.