The breakthrough came after 15 hours of intense negotiations between countries in the bloc.

The agreement's expected to strike a balance between the demands of northern European countries such as Britain and the Netherlands that wanted a belt-tightening EU budget, and countries in the south and east that wanted sustained spending on farming subsidies and much-needed infrastructure.

Leaders are expected to continue negotiating in the hope that they can sign off on a final agreement later today

Talks were delayed by 6 hours when pre-agreements sought by the European Council were not sealed prior to the negotiations.

Political and ideological divisions ran deep as the UK, the Netherlands and Sweden argued for a budget cut that reflected the cuts being implemented in domestic governments across the union.

Headline spending of €960 billion from €1,25 trillion has been agreed in principle but talks will resume in a few hours.

Sky's Joey Jones, who's in Brussels, says the group are taking Britain's concerns about overspending into account:

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