U.S. Congressional leaders have reached a deal to raise the debt ceiling, reduce the deficit and avoid a government default, President Barack Obama said on Sunday night, Reuters reported. The deal now must be approved by Congress, with a vote happening as early as Monday, according to CBS New.
More from GlobalPost: America’s Debt Crisis in Photos
Obama said the agreement would cut about $1 trillion over 10 years.
The president said it wasn't the agreement he would have preferred, but added that the deal would make a "serious downpayment" on the U.S. deficit, BBC News reported.
According to the Sydney Morning Herald:
"I want to announce that the leaders of both parties in both chambers have reached an agreement that will reduce the deficit and avoid default, a default that would have had a devastating effect on our economy," Obama said in hastily made remarks at the White House on Sunday night.
Obama said that spending cuts that are part of the agreement to raise the debt ceiling wouldn't happen so quickly that they would hurt the fragile U.S. economy.
More from GlobalPost's Macro Blog: US economy, no, it's not getting better
Nevertheless, he said the agreement would result in the lowest level of domestic spending since the Eisenhower administration, according to CBS News.
Obama said "we have to ask wealthiest Americans to give up tax breaks," and that some adjustments would have to be made to programs like Medicare and Medicaid.
In addition, a bipartisan Congressional committee will report back by November with a plan to cut the deficit more. That proposal will then be presented to Congress for a vote.
Democrats and Republicans in Washington have been stalemated over agreeing on a plan to cut spending and raise the debt limit as the Aug. 2 deadline for government default approached, BBC News said.
It isn't clear how much support this eleventh-hour deal will have in the House of Representatives, where tea party representatives and liberal Democrats alike have been adamant about their pet issues of spending cuts and tax increases for the rich, respectively, according to CBS News.
More from GlobalPost: Global economy, calamity calling