US President George W Bush has welcomed a reconciliation agreement among Iraqi leaders, but warned that much work remained to quell sectarian violence.
Mr Bush described the deal as "an important step"
He was speaking a day after the deal among Iraqi Shia, Sunni and Kurdish politicians was announced by Iraqi Prime Minister Nouri Maliki.
"These leaders... recognise the true and meaningful reconciliation that needs to take place," Mr Bush said.
Mr Maliki's Shia-led cabinet has been recently criticised by US politicians.
"Yesterday's agreement reflects their [Iraqi leaders'] commitment to work together for the benefit of all Iraqis to further the process," Mr Bush said in a brief statement in Albuquerque, New Mexico.
Describing the accord as "an important step", he said he had told Iraqi leaders that "much more needs to be done".
"The Iraqi parliament will convene again in early September and it will need to act to codify this political progress," Mr Bush said.
The deal has been pushed by the US as a key step to forge national unity and quell sectarian violence in Iraq.
On Sunday, Mr Maliki said the agreement was the second step towards rebuilding Iraq's political process, after four Kurdish and Shia parties formed a new alliance.
Mr Maliki said the deal was a step to rebuild Iraq's political process
A committee formed by the parties had "accomplished some solutions", he said.
Issues under discussion between Iraqi politicians include holding provincial elections and easing a ban on former Baath party members in the civil service and military.
After the meeting, Mr Maliki appeared at a news conference alongside Iraqi President Jalal Talabani, who is a Kurd, Sunni Vice-President Tariq al-Hashemi, Shia Vice-President Adel Abdul-Mahdi and Massoud Barzani - president of the Kurdish region.
But nothing suggests that the rebuilding of a broad-based government is necessarily any closer, the BBC's Mike Wooldridge in Baghdad says.
Mr Hashemi said he had taken part in the talks as vice-president but did not indicate his Iraqi Islamic Party was about to join the moderate Shia-Kurdish alliance.
Mr Maliki earlier hit back at senior US politicians who have called for him to be removed from office, singling out senators Hillary Clinton and Carl Levin.
He said the Democratic senators were acting as if Iraq was "their property" and that they should "come to their senses" and "respect democracy".
US commander in Iraq, General David Petraeus, and US ambassador Ryan Crocker are expected to report to US Congress in mid-September on progress in Iraq since the troop surge.
The introduction of 30,000 extra troops - completed in mid-June - was supposed give the Iraqi government extra time to make political progress.