Europe must act quickly to stem its economic crisis, president Barack Obama said on Friday as he called on European leaders to strengthen their banks and urged Greece to remain in the eurozone.

Obama addressed reporters at the White House as it emerged that Spanish officials would meet EU officials this weekend and ask for help shoring up their troubled banks.

"There is a path out of this challenge. These decisions are in the hands of Europe's leaders; they understand the urgent need to act. There are specific steps they can take right now to prevent the situation from getting worse. One of those steps is taking clear action as soon as possible to inject capital into weak banks," said Obama.

The president said he had been in "constant contact" with European leaders and his own financial advisers as the crisis developed. He urged Greece to act to stay within the eurozone before elections next week arguing that "hardships will likely be worse" if it leaves.

Obama said the US was strong enough to absorb "some of the shocks from across the Atlantic" but that the European crisis was still a threat to America's fragile recovery.

"If Europe goes into recession, that means we are selling fewer goods, fewer services – and that's going to have some impact," he said.

The president also blamed political gridlock for the slow pace of the US recovery. He said Congress's refusal to pass job creation legislation had cost the US economy 1m jobs, and said cuts to government jobs at the local level were holding back the recovery. Obama said the private sector was "doing fine".

His comments were attacked Republican majority leader Eric Cantor. "My question to the president would be: 'are you kidding?'" Cantor said during a press conference.

"Did he see the job numbers that came out last week? The private sector is not doing fine. And, frankly, I'd ask the president to stop engaging in the blame game. It's not because of the headwinds of Europe. It's not because of House Republicans. It's because of the failed stimulus policies and other items in his agenda that small businesses in this country just aren't growing," Cantor added.

The president has begun attacking Republican-backed austerity measures as part of his 2012 election campaign – and has pointed to the failure of austerity to solve the crisis in Europe. "There's nothing fiscally responsible about waiting to fix your roof until it caves in," he said.

The president spoke a day after Ben Bernanke, the Federal Reserve chairman, warned: "The situation in Europe poses significant risks to the US financial system."

Meanwhile, sources in Brussels and Germany said Madrid had bowed to mounting pressure and asked for international help for its debt crisis.

A conference call between the 17 members of the eurozone will be held on Saturday – when the financial markets are closed – to discuss the request from Spain, the fourth biggest economy in the eurozone.

On Thursday, the ratings agency Fitch slashed Spain's credit worthiness by three notches to just above junk status and warned that its estimate of the cost of a bank bailout had doubled to €60bn ($75bn).

"The government of Spain has realised the seriousness of their problem," a senior German official told Reuters.

He added that an agreement had to be reached before a Greek general election on 17 June. If parties opposed to the terms of a European Union-International Monetary Fund bailout win, it could cause market panic and lead to Athens leaving the eurozone.

Spain's banks lent heavily to the construction sector during the property bubble in the first half of the last decade and are now being doubly squeezed because they hold large quantities of Spanish government bonds.

The Fitch downgrade led to a sharp sell-off in European share prices on Friday morning but the reports of a weekend Spanish bank deal reduced the losses.