The vote on the US debt deal has been passed by the Senate hours before the default deadline. The deal will cut the country's bulging deficit and lift the 14.3 trillion dollar debt ceiling, carrying it beyond the November 2012 Presidential election.

Obama signed the bill into law and said the emergency bill was a first step towards ensuring the country lives within its means, but he also insists more is needed to rebuild the US economy.

The US Senate on Tuesday passed a last-minute bipartisan debt ceiling deal to stave off a looming debt default crisis. The vote was 74 to 26 in favor of the bill.

The Senate passage came after the Republican-controlled House of Representatives approved it Monday night. The Senate action cleared the last key hurdle for the bill to be signed into law by US President Barack Obama.

The plan is aimed at slashing the deficit by more than 2 trillion US dollars over the next decade, setting up a powerful new congressional bipartisan committee to find new ways to cut the deficit, and raise the US borrowing limit through 2013.

Obama signed the bill into law and said the emergency bill was a first step towards ensuring the country lives within its means, but he also insists more is needed to rebuild the US economy.

Meanwhile, Obama expects tax reform to emerge from deliberations around a new joint bipartisan committee to be established by the legislation, and that a "balanced approach" in which the wealthier pay more taxes is needed for more deficit reduction.

Obama has urged Congress to pass stalled trade bills and said he wants unemployment benefits extended as well.