A handful of hard-right Republicans said they would oppose the deal to raise the $31.4trn (£25.5trn) debt ceiling, highlighting the dangers of the US suffering a “catastrophic” default.

Conservatives have criticised the agreement between Joe Biden and House Speaker Kevin McCarthy for falling short of the deep spending cuts they wanted.

Meanwhile, liberals have bemoaned policy changes such as new work requirements for older Americans in the food aid program.

Florida Governor Ron DeSantis, a candidate for the Republican 2024 presidential nomination, said the deal does not do enough to change the fiscal trajectory. 

He told Fox News: “After this deal, our country will still be careening toward bankruptcy.”

President Biden said he “feels good” about the debt ceiling deal which will be considered by the House Rules Committee this afternoon before a vote on sending it to the full House for a vote expected Wednesday.

US Treasury Secretary Janet Yellen has warned of the “catastrophic” consequences of a deal not being passed, which could mean the US runs out of money as soon as June 1 and could default on its debts.

Treasuries and US stocks rallied in pre-market trading amid hopes that Congress will pass a debt-accord to head off a default as White House and Republican congressional leaders stepped up lobbying in support of the deal.

Near-maturity Treasury bills were boosted in Asian hours as trading resumed after the US markets were closed for Memorial Day. More broadly, Treasury yields declined across the curve on debt dated from five years to 30 years.

Contracts on the S&P 500 and Nasdaq 100 rose 0.3pc and 0.4pc, respectively. European futures made small gains and the picture across Asian equity markets was mixed.

The dollar, which has benefited from angst around the statutory borrowing limit, slightly fell, with an index of greenback sitting comfortably below the two-month high set last week.