The White House has acknowledged “real differences” with Republicans in the budget and debt ceiling talks and warned that negotiations will be “difficult,” according to a White House official.

Why it matters: While Team Biden wants to signal that a bipartisan compromise remains possible, they are preparing for a difficult road ahead. They also don’t appear to be racing to restart the talks, even as time is running out to find an agreement.

Driving the news: Earlier Friday, Rep. Garret Graves (R-La.) walked out of negotiations, called the White House “unreasonable,” and declared that the talks were on a “pause.”

• Team Biden is also trying to pressure House Speaker Kevin McCarthy (R-Calif.) to accept a deal that might be unacceptable to large swaths of his conference.
• “There are real differences between the parties on budget issues and talks will be difficult,” a White House official said in a statement.
• "The President’s team is working hard towards a reasonable bipartisan solution that can pass the House and the Senate.”

The big picture: If a deal is not reached soon, the U.S. could run out of money on June 1.

• Treasury Secretary Janet Yellen has repeatedly warned of the deadline, telling the country’s biggest bankers yesterday that outside forecasters have validated it.

The other side: Senate Minority Leader Mitch McConnell (R-Ky.) reacted to the apparent suspension of the talks by blaming Biden for not engaging with McCarthy for several months.

• "It is past time for the White House to get serious. Time is of the essence,” he tweeted.