Democratic President Joe Biden and a Republican negotiator said on Friday they were working on a deal to raise the U.S. government’s $31.4 trillion debt ceiling after the Treasury Department warned that a June 5 default loomed without action.

The two sides have been negotiating for weeks on an agreement to raise the federal government’s self-imposed borrowing limit, with Republicans also pushing for sharp spending cuts. Without a deal, the United States could face a calamitous default.

“Things are looking good,” Biden told reporters. “I’m optimistic.”

Republican Representative Patrick McHenry said he concurred with Biden’s comments, while cautioning that negotiations had not yet concluded.

“I’m hopeful,” said McHenry, one of House of Representatives Speaker Kevin McCarthy’s lead negotiators with the White House. “But we have to make sure we have a line on tax, we have a line on agreement – there’s significant challenges ahead.”

The two spoke, separately, shortly after U.S. Treasury Secretary Janet Yellen said the government would run short of money to pay its bills on June 5. Yellen had previously said that date could come as soon as June 1, meaning that the new forecast allowed for more time but a harder final deadline.

Negotiators are discussing a deal that would lift the limit for two years, but remain at odds over whether to stiffen work requirements for some anti-poverty programs.

McCarthy left the Capitol on Friday following a conference call in which one of his top lieutenants told fellow Republicans no deal had been reached, CNN reported.

Any agreement would have to win approval in the Republican-controlled House and the Democratic-led Senate before Biden could sign it into law – a process that could take more than a week.

Negotiators have tentatively reached an agreement that would cap spending on many government programs next year, according to a U.S. official.