President Barack Obama walks out to deliver a statement in the Rose Garden of the White House today AP Photo/Pablo Martinez Monsivais
US Debt

Senate clears the way for US to raise debt ceiling

The Senate voted by 74 votes to 26 to pass the hard fought bill. Obama has said that it’s the first step to ensuring America lives within its means.

THE UNITED STATES SENATE has voted to pass the hard-fought bill that will allow the country to raise its debt ceiling and stave off the threat of a sovereign default.

The bill won bipartisan support in the Senate to clear the 60-vote threshold it needed to be cleared, passed by 74 votes to 26 according to Reuters, and now goes to President Barack Obama to be signed into the law.

It had earlier been passed by the House of Representatives by 269 votes to 161 – with the House’s minority Democratic ranks split perfectly down the middle, 95 in favour and 95 against.

The bill commits the country to slashing government spending, in a bid to reduce the overall government deficit by somewhere between $2.1 trillion and $2.4 trillion over the next decade.

Without a law in place, the US was set to reach its current legal debt limit – of just under $14.3 trillion (just under €10 trillion) – at some point later today.

The United States’ credit rating could still be downgraded irrespective of the new deal.

President Barack Obama said the bill is just the first step to ensuring the country lives within its means.

Speaking in the Rose Garden of the White House, Obama said lawmakers still need to find a balanced approach to reducing the deficit that includes some adjustments to Medicare and reforming the tax code so the wealthy pay more.

The White House said Obama will sign the bill as soon as it lands on his desk.

WATCH: Giffords returns to work as US congress passes debt deal>

- Additional reporting by AP and Emer Mc Lysaght

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