Hong Kong's leader is willing to let pro-democracy demonstrations blocking large areas of the city go on for weeks if necessary, a source close to him said, while defiant protesters vowed they would not budge.

Hong Kong's streets were calm early on Thursday while police largely kept their distance from the tens of thousands of mostly young people keeping up protests, now nearly a week old, in the heart of the global financial hub.

The protesters want Hong Kong's leader, Leung Chun-ying, to step down by the end of Thursday and have demanded China introduce full democracy so the city can freely choose its own leader. Leung, appointed by Beijing, has refused to stand down, leaving the two sides far apart in a dispute over how much political control China should have over to Hong Kong.

The popular "Occupy Central" movement presents one of the biggest political challenges for Beijing since it violently crushed pro-democracy protests in Tiananmen Square in 1989.

Leung, Hong Kong's chief executive, is prepared to allow the protests to subside and will only intervene if there is looting or violence, said a government source with ties to Leung.

Hong Kong protest Joshua Wong

Joshua Wong, leader of the student movement, delivers a speech as protesters block the main street to the central financial district, outside the government headquarters building in Hong Kong Oct. 1, 2014. (Carlos Barria/Reuters)

"Unless there's some chaotic situation, we won't send in riot police ... We hope this doesn't happen," the source said. "We have to deal with it peacefully, even if it lasts weeks or months." Leung could not be reached for comment.

Raising the stakes in their standoff with the authorities on Wednesday, Hong Kong's pro-democracy protesters threatened to occupy key government buildings unless Leung resigns.

The Chinese government, meanwhile, appeared to be losing patience. An editorial solemnly read Wednesday on state TV said all Hong Kong residents should support authorities in their efforts to "deploy police enforcement decisively" and "restore the social order in Hong Kong as soon as possible."

And the Communist Party-run People's Daily warned of "unimaginable consequences" if the protests persist.

Storming government buildings would risk inviting another clash with police like the one over the weekend. It also would put pressure on the Chinese government, which has backed Leung's attempts to end the protests but has not openly intervened.

In Washington, U.S. Secretary of State John Kerry met with Chinese Foreign Minister Wang Yi and said the U.S. supports the "highest possible degree of autonomy" in Hong Kong. He said he hopes Hong Kong authorities exercise restraint and allow the protesters to express their views peacefully.

Wang said that the protests are "China's internal affairs" and that no country would allow "illegal acts" against public order.

Protesters vow to step up actions

One of the protest leaders, Lester Shum, vice secretary of the Hong Kong Federation of Students, said there was "no room for dialogue" with Leung because he had ordered police to fire tear gas at demonstrators over the weekend.

"Leung Chun-ying must step down. If he doesn't resign by tomorrow, we will step up our actions, such as by occupying several important government buildings," he said, adding that demonstrators would not interfere with essential government agencies such as hospitals and social welfare offices.

'I hope people will understand why the action keeps on escalating. It's because the government is getting more and more closed without listening to Hong Kong people.' - Protest leader Chan Kin-man

Chan Kin-man, another protest leader, said the demonstrations will continue as long as the Hong Kong government fails to give a satisfactory response to their demands.

"I hope people will understand why the action keeps on escalating. It's because the government is getting more and more closed without listening to Hong Kong people," he said in an interview on the street.

The protests were triggered by Beijing's recent decision that all candidates in the inaugural 2017 election for Hong Kong's top post must be approved by a committee of mostly pro-Beijing local elites.

In a speech early Wednesday marking National Day, the anniversary of the 1949 founding of Communist China, Leung did not mention the protesters, but told voters it would be better to agree to Beijing's plan and hold an election than to keep the current system, in which an Election Commission chooses the chief executive.

Protesters heckled Leung after he arrived for the flag-raising ceremony. Hundreds yelled at him to step down, then fell silent and turned their backs when the ceremony began.

Beijing's tone hardens

As the protests have worn on, Beijing's tone has hardened.

President Xi Jinping, who has acted harshly against any perceived threats to the Communist Party's hold on power, vowed in a National Day speech to "steadfastly safeguard" Hong Kong's prosperity and stability.

Turning up the pressure on leaders in Beijing, sympathy protests sprang up in Macau, a former Portuguese colony that China took over in 1999, and in the independently ruled island of Taiwan, which China claims as its own.

The crowds of protesters in Hong Kong swelled on Wednesday, a national holiday, to tens of thousands, including many families with children, couples, students, retirees and foreigners who live in the city of 7 million.

Thousands were expected at Umbrella Revolution rallies in 40 U.S. cities, including New York, San Francisco, Boston and Chicago, as well as major Canadian cities like Toronto and Calgary. There were also major gatherings in cities around the world Wednesday to support Hong Kong protesters, including London and Singapore. 

With files from Reuters