US avoids default as Obama signs debt bill into law

The bill cleared its final hurdle in the Senate by 74 votes to 26.President Barack Obama has signed legislation to increase the US debt ceiling and avert a financial default after Congress voted in favour of a bipartisan compromise deal.It raises the debt limit by up to $2.4tn (£1.5tn) from $14.3tn, and makes savings of at least $2.1tn in 10 years.The deal was struck after negotiations between Republicans, Democrats and the White House went down to the wire.Without a deal to raise the debt ceiling, the US would have been unable to meet all its bills, the treasury department had warned.Speaking at the White House shortly after the decisive vote in the Senate, President Obama said it was "pretty likely that the uncertainty surrounding the raising of the debt ceiling for businesses and consumers has been unsettling".The bill's signing came roughly 10 hours before the expiry of a deadline for Washington to raise its borrowing limit."It's something we could have avoided entirely," he added.
He urged Congress to now look to boost the economy through measures to create jobs and increase consumer confidence.The president said more action was needed, saying it was impossible for the US to "close the deficit with just spending cuts"."We can't balance the budget on the backs of the very people who have borne the biggest brunt of this recession," President Obama said, reprising one of his key themes of recent weeks.