(CNN) -- Senate Majority Leader Chuck Schumer announced Thursday morning that a deal has been reached for an extension of the nation's debt ceiling through early December, a major breakthrough to avert economic disaster that comes after weeks of partisan deadlock over the issue.
"We have reached agreement to extend the debt ceiling through early December and it's our hope that we can get this done as soon as today," Schumer said in floor remarks.
The announcement comes a day after Senate Minority Leader Mitch McConnell publicly floated a debt ceiling proposal, which sparked negotiations between the two parties to reach an agreement.
"Republican and Democratic members and staff negotiated through the night in good faith," said McConnell, a Republican from Kentucky, on Thursday following Schumer. "The Senate is moving toward the plan laid out yesterday to spare the American people a manufactured crisis."
Both parties have made clear that the country must not default and that even coming close to it would likely bring catastrophic economic consequences.
Yet while the deal announced Thursday stands to avert immediate economic disaster, it does not resolve the underlying partisan stalemate over the issue. It merely delays the fight until another day.
Republicans have been insistent that Democrats must act alone to address the debt limit through a process known as budget reconciliation. Democrats have argued the issue is a shared bipartisan responsibility and that process is too lengthy and unwieldy and that the risk of miscalculation would be too high.
That fundamental dispute remains, making it unclear what will happen in early December.
Lawmakers will also have to deal with the expiration of government funding in the same time-frame after recently passing a short-term extension to avert a shutdown that lasts through December 3.
An aide familiar with negotiations told CNN that the deal Schumer announced on Thursday is to increase the debt ceiling by $480 billion, which is how much the Treasury Department told Congress it would need to get to December 3.
Schumer took steps Thursday to set up a procedural vote on the short-term debt ceiling increase deal in case any senators decide to slow walk the process.
Senate Majority Whip Dick Durbin suggested that Schumer's move is precautionary. He said they don't know of any GOP senators yet that plan to object to swift passage of the debt limit increase.
"I don't think that signal has been sent or received yet, I hope it isn't," Durbin said.
As of now, it seems likely the Senate could pass the extension Thursday with an agreement. But if there are objections, it could delay final passage into the weekend.
McConnell said on Thursday that the agreement provides Democrats with more time in the next two months to use reconciliation to raise the debt limit themselves.
He argued this resolves the "the majority's excuse that they lacked time" to address it through the cumbersome budget process.
McConnell again repeated his other so-called compromise that Republicans would be open discussing a longer term bipartisan debt ceiling increase, if Democrats ditch their massive social safety net bill. That would be a non-starter for Democrats, however.
"If our colleagues would instead prefer a more traditional bipartisan discussion around basic governance, they can stop trying to ram through yet another reckless taxing and spending spree. ... That would be the path toward that kind of discussion," he said.
Treasury Secretary Janet Yellen had warned lawmakers that the federal government will likely run out of cash by October 18 unless Congress raises the debt ceiling.
But Congress may not even have that long, since the deadline is more of a best guess estimate than a set in stone deadline. That dynamic intensified pressure on both sides to reach a deal this week.
This story has been updated with additional developments Thursday.
The-CNN-Wire™ & © 2021 Cable News Network, Inc., a WarnerMedia Company. All rights reserved.