Obama urges Congress to raise U.S. debt ceiling (2)

Even a threat of defaulting on government obligations is affecting investor confidence and hurting the economy, and threatening to not raise the debt ceiling is "absurd," Obama stated.

Congress Republicans have demanded steep spending cuts from Democrats in exchange for a debt ceiling increase even at the risk of a government shutdown.

The U.S. economy is poised for a good year if Washington politics doesn't get in the way, said Obama, cautioning that Republican lawmakers should not use a government default or shutdown as the bargaining chip to push for government spending cuts.

The United States is making progress in enhancing its fiscal sustainability in the past years as a result of government spending cuts and more government revenue. The United States is moving toward the goal of reducing 4 trillion U.S. dollars in government deficit over a decade, Obama noted.

The president urged the country to adopt a balanced deficit reduction approach to ensure key investments to bolster economic growth and protect the interests of the middle class.

Speaking at an event hosted by University of Michigan on Monday, U.S. Federal Reserve Chairman Ben Bernanke also pressed Congress to raise the country's borrowing limit to avoid a potentially disastrous default.