With the health of the fragile economy hanging in the balance and financial markets watching closely, the leaders said they would present the compromise to their caucuses on Monday morning in hopes of enacting it before a Tuesday deadline to avert default.
Even as the president was speaking from the White House on Sunday night, Speaker John A. Boehner was on a conference call with House Republicans, trying to sell them on the proposal he had signed off on only minutes before.
Since he is likely to lose the most conservative elements of the caucus, Mr. Boehner faces the task of framing the pact as friendly enough to Republican principles to win over a significant group of his rank-and-file without alienating Democrats he will need to push it over the top.
President Obama, in a hastily called appearance with reporters that ended a day of uncertainty, said that the compromise would “allow us to avoid default and end the crisis that Washington imposed on the rest of America.”
“It ensures also that we will not face this same kind of crisis again in six months, or eight months, or 12 months,” he said. “And it will begin to lift the cloud of debt and the cloud of uncertainty that hangs over our economy.”
Just before Mr. Obama spoke on television, the two Senate leaders, Harry Reid and Mitch McConnell, took the floor to endorse the pact as well.
“I am relieved to say that leaders from both parties have come together for the sake of our economy to reach a historic, bipartisan compromise that ends this dangerous standoff,” said Mr. Reid, the majority leader.
The tentative agreement calls for at least $2.5 trillion in spending cuts over 10 years, a new Congressional committee to recommend a deficit-reduction proposal by Thanksgiving, and a two-step increase in the debt ceiling.
The announcement concluded a tumultuous 24 hours that saw hopes rise Saturday night over the prospects of a deal that might have concluded the budget stalemate. By Sunday, worry set in again as lawmakers and White House officials struggled to hammer out the fine points of an agreement that must clear a Senate controlled by Democrats as well as by the Republican House.
If the deal clears Congress, with its new special joint committee to explore deficit reduction, it will ensure that the size and scope of the federal government and the tension between spending and taxes will remain front and center in the Washington debate headed into the 2012 election.
Markets reacted favorably to the announcement. Asian markets jumped on news of the deal. The Nikkei was up 1.7 percent in early trading; the dollar rose about 1.4 percent against the Japanese yen.
The agreement came after a day of wrangling over Pentagon cuts, and it still must win majority support in the Senate and the House, with the House providing a particular challenge.
On the conference call, Mr. Boehner sought to portray the new agreement as one heavily tilted toward the Republican call for no new revenue, and he said it met the goal of instituting cuts greater than the amount of the debt limit increase. In a presentation, he said the pact would prevent a “job-killing default” — a warning to lawmakers that failure to raise the limit could add to the bleak employment picture.
“Our framework is now on the table that will end this crisis in a manner that meets our principles of smaller government,” said Mr. Boehner, who said he hoped to get the legislation onto the House floor as quickly as possible.
As conversations flowed between the White House and Capitol Hill, Mr. Reid earlier Sunday publicly embraced the compromise that would tie deep spending cuts to a debt ceiling increase, though his plan to bring it to a vote as early as Sunday was put off, as was a tentative meeting of Senate Democrats to review it.
According to Congressional and administration officials, the delay was attributable to efforts by Mr. Boehner, Republican of Ohio, to limit immediate reductions in the Pentagon budget and better protect it from future cuts in order to cement votes from defense hawks. He needs those votes to win approval of the plan in the House.
Robert Pear and Jackie Calmes contributed reporting.
This article has been revised to reflect the following correction:
Correction: July 31, 2011
An earlier version of this story incorrectly stated when the automatic cuts would occur if Congress does not approve a second round in a few months. They would occur at the end of the year 2012, not 2011.
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