U.S. President Barack Obama said on Monday that both parties should use the ongoing debt limit talks as an opportunity to do something meaningful for the long- term debt reduction.

Obama said he was still pushing congressional leaders from both parties to reach the largest deal possible to slash government spending and aimed at making the government leaner and more effective, he said at a Monday White House press conference.

"If not now, when?" Obama challenged, adding that he was prepared to ink a large-scale spending cut deal.

Obama and a group of top lawmakers are scheduled to meet again later on Monday to continue their talks on lifting U.S. federal debt limit and cutting deficit to avert a looming default.

Talks among Obama and the congressional leaders on Sunday evening failed to break a stalemate over how to raise the debt ceiling.

The borrowing limit, currently at 14.29 trillion, was reached on May 16 this year. The U.S. Treasury Department said the world's largest economy would default without an agreement to lift the limit by August 2.

Obama stressed that the top priority for this administration is to put the economy back on track and people back to work, adding that debt reduction should be carried out in a balanced way to facilitate investment in key industries and boost job creation.

Obama warned he would not sign a short-term and temporary stopgap measure to avoid debt default, saying that the United States could not threaten its credit and economic prosperity on a first-ever possible default in history.

With the debt ceiling deadline approaching, some Republicans suggested a temporary stopgap debt ceiling to give both parties more time for negotiation, but Obama was strongly against the approach.

Obama urged lawmakers to ditch entrenched partisanship to ink a deal in a timely manner, adding that there will be no path to a debt reduction deal if Republicans don't make compromise on tax increases.

He insisted that both parties had to reach a debt ceiling agreement by August 2.