Angel Gurria
Media playback is unsupported on your device
Video

OECD 'relief' over US debt agreement

The United States House of Representatives has approved a bill that raises the limit on national borrowing averting the risk that the government might, for the first time ever, default on its debt payments.

Officials say a debt default would severely damage the global economy.

The hard fought compromise split both the Democratic and Republican parties.

The bill raises the borrowing limit by $2tr and also calls for spending cuts over ten years with no new taxes.

The head of the Organisation for Economic Cooperation and Development (OECD), Angel Gurria, described the deal as a relief but said more cuts would be needed to resolve America's debt problem.

Go to next video: Rating agencies still threaten US