Ongoing U.S. "fiscal cliff" negotiations were proceeding "very, very well," a top Republican senator told CNBC on Monday, heightening expectations that Congress and the White House may strike an accord as early as Tuesday which could prevent the economy from absorbing a raft of tax hikes and spending cuts.
With the final trading day of 2012 hanging in the balance of tough discussions between President Barack Obama and congressional leaders, Sen. Bob Corker, Tennessee's senior senator and an active participant in negotiations, told CNBC's "Squawk Box" that a deal was "going to happen, it's probably going to happen today."
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In talks about raising taxes on the wealthiest Americans, reports say that discussions between Senate Minority Leader Mitch McConnell and Vice President Joe Biden have set an income threshold of around $400,000.
In his interview with CNBC, Corker cited that figure as "my guess," but wasn't certain.
Still, Corker tempered some of his optimism by voicing skepticism about claims that the White House has offered up about $1 trillion worth of spending cuts. Corker said that it was likely that an agreement would be reached, but "nothing is going to happen that has anything to do with deficit reduction."
With discussions still ongoing about raising the U.S.'s statutory borrowing limit, which could be breached within days, Corker added: "I do think there is going to be a [resolution] to this, but the problem is we created this fiscal cliff to make some tough decisions, and none are going to be made. Not one.
A deal to raise the U.S. borrowing threshold from its current $16 trillion limit "will be a serious moment, and our economy is not going to be what it could have been," the senator said. "We'll eke by this, but the real discussions are going to begin."
The Biden-McConnell negotiations appeared to offer the last hope for avoiding the across-the-board tax increases and draconian cuts in the federal budget that will be triggered at the start of the New Year because of a deficit-reduction law enacted in August.