Last-minute deal

The US government narrowly avoided a shutdown late on Friday, after Democrats and Republicans came to a temporary agreement on spending cuts. Without the deal, money to operate federal government would have run out at midnight on Friday.

The last-minute compromise requires lawmakers to approve stopgap funding to keep federal agencies running into next week, until the budget agreement can be formally enacted.

The White House and congressional leaders decided to make $37.8 billion (26.2 billion euros) in spending cuts in a budget for the rest of the fiscal year, which ends September 30. The deal narrowly averted what would have been the first government shutdown in 15 years

Relief in the White House

US President Barack Obama said the cuts were part of learning to "live within our means." He added that the deal was reached "because Americans of different beliefs came together."

"I am pleased Senator Reid and I and the White House have been able to come to an agreement that will in fact cut spending and keep our government open," John Boehner, the speaker of the US House of Representatives told reporters.

A shutdown would have kept thousands of government employees from work, and potentially hampered the American economic recovery. Politicians also risked voter wrath for seeming unwilling to compromise.

Failure would have posed risks for Obama amid signs of public frustration with the rancorous budget debate as the 2012 presidential election campaign gathers steam.

Author: Sarah Harman, Joanna Impey (AP, dpa, Reuters)

Editor: Sean Sinico