U.S. President Barack Obama on Thursday "strongly condemned" the steps taken by the Egyptian interim government and security forces and announced the cancellation of joint military exercises in his first response to a violent crackdown on protesters in the Arab country.

"Our traditional cooperation cannot continue as usual when civilians are being killed," Obama said in an audio message broadcast to the nation from Martha's Vineyard in the U.S. East Coast state of Massachusetts, where he is on vacation with his family.

The Egyptian security forces moved Wednesday to clear two camps in Cairo, the national capital of Egypt, which were occupied by supporters of ousted President Mohamed Morsi demanding his reinstatement, resulting in deadly clashes across the country with at least 525 deaths and 3,717 injuries reported by the Health Ministry.

Hours after the raids on the camps in Cairo, Egypt's interim government declared a state of emergency nationwide for one month, imposing a curfew on Cairo and 10 provinces and allowing security forces to arrest and detain civilians indefinitely without charges.

Obama's cancellation of the Bright Star joint military exercise with Egypt, a biennial event due to take place in the Sinai region next month, followed Washington's halted delivery last month of four F-16 fighters to Cairo to show its displeasure with the military's handling of the situation, which turned ugly once again after Morsi's ouster on July 3 sparked deadly confrontations in the country.

However, the Obama administration has opted not to label Morsi' s removal by the army a coup, enabling it to continue its 1.3 billion dollars in annual aids to the Egyptian military.

"Let me say that the Egyptian people deserve better than what we've seen over the past several days," Obama said in his statement. "To the Egyptian people, let me say that the cycle of escalation needs to stop."

"We appreciate the complexity of the situation," he said. " While Mohamed Morsi was elected president in a democratic election, his government was not inclusive and did not respect the views of all Egyptians."

The U.S. president also said he had asked his advisors to " assess implications" of the Egyptian interim government's actions and consider "further steps."

"America wants to be a partner in the Egyptian people's pursuit of a better future," he said, reiterating that Washington does not take sides with any party or individual in Egypt.

The United States values its relationship with Egypt, the other Arab nation besides Jordan that has signed a peace deal with Israel.

Egypt's descent into another cycle of violence, however, has been seen as a sign of Washington's waning influence in the country.

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