President Donald Trump wants to avoid another shutdown as the White House and Congress try to scrape together a deal to fund the government and raise the U.S. borrowing limit, Treasury Secretary Steven Mnuchin said Wednesday.

If the Trump administration and Congress fail to reach a spending agreement, the White House will offer a continuing resolution to keep the government funded at its current levels for a year, he said. The administration would also propose a one-year debt ceiling increase.

Mnuchin made the comments to reporters after a meeting among White House officials and congressional leaders in House Speaker Nancy Pelosi's office.

The Treasury secretary said lawmakers from both parties agreed that they needed to raise the debt ceiling. If Congress fails to increase the borrowing limit, the U.S. could risk default on its debt — which would have ripple effects throughout the global economy. The Treasury could lose the ability to pay its bills in the coming months.

During the meeting, negotiators had a tougher time coming to an agreement on spending caps, according to multiple reports. If officials in Washington cannot raise those limits, it could trigger budget sequestration — significant automatic cuts across government agencies.

Republicans said Democrats pushed for more nondefense spending Wednesday than they previously had, according to reports. Funding for the current fiscal year runs out Sept. 30.

Congress will have to beat both the budget and debt ceiling deadlines, as Congress typically leaves Washington for the month of August. Failing to address both issues could wreak havoc on the U.S. and global economies.

In December and January, funding for parts of the government lapsed for a record 35 days.

— CNBC's Ylan Mui contributed to this report.

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