President Barack Obama says Republican and Democratic leaders have reached agreement on raising the US debt limit, thereby avoiding default.
Under the proposal, which still needs to be approved by Congress, the US debt ceiling would rise by up to $2.4tn from the current $14.3tn.
In return, the US government deficit will be reduced by a similar amount over 10 years.
A special bipartisan committee will also be set up to agree spending cuts.
Both houses of Congress are expected to vote on the proposal on Monday.
The BBC's Jane O'Brien says the package is still likely to be a tough sell, with some Republicans and Democrats in the House of Representatives remaining opposed to different aspects.
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The US faces a Tuesday deadline to raise its $14.3tn (£8.7tn) debt limit or risk the first default in its history, a possibility that has spread mounting unease through international markets.
The US president said it was not the deal he would have preferred, but noted that the compromise plan would make a "serious downpayment" on the US deficit.-BBc
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