1st August 2011
BBC News reports that under the proposed deal, the US debt ceiling would rise by up to $2.4tn.
In return, Congress has committed to reducing the deficit by a similar amount over 10 years, and a special bipartisan committee will be set up to agree cuts.
However Congress has yet to approve the deal; both house will vote on Monday (1 August).
The BBC's Jane O'Brien notes that package is still likely to be a "tough sell, with some Republicans and Democrats in the House of Representatives remaining opposed to different aspects."
However Obama is quoted in the Guardian as saying "We are not done yet."
"Although the Senate is almost certain to pass the move, it could face opposition in the House of Representatives from hardline Republicans and disenchanted, leftwing Democrats who feel Obama has conceded too much.
Experts warned that even if a deal was struck, the world's largest economy was likely to be stripped of its triple-A debt rating by Standard & Poor's.
Mohamed El-Erian, the head of the world's largest bond investor, Pimco, told the US broadcaster ABC: "Things that need to happen are not happening fast enough. If S&P sticks to what it said, it will downgrade."
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