The US President last night said leaders of both parties in the US House and Senate had approved the agreement, which must now be sold to Congress by 2 August, according to Bloomberg.
“This compromise does make a serious down payment on the deficit-reduction we need. Most importantly it will allow us to avoid default,” Obama said.
A raise in the debt ceiling by at least $2.1trn would serve the nation’s needs into 2013.
The deal includes a cut in spending over a decade of $917bn.
Initially the debt limit would be raised by $900bn, and then a special committee would be tasked with finding another $1.5trn in deficit savings by the end of the year.
Congress is expected to agree the deal.