Congress to vote on fiscal agreement as Boehner concedes defeat

U.S. House Speaker John Boehner (Source: Bloomberg) U.S. House Speaker John Boehner (Source: Bloomberg)

Congress is poised to end the 16-day government shutdown and raise the U.S. debt limit after the bipartisan leaders of the U.S. Senate reached an agreement to end the nation’s fiscal impasse.

The Senate and House plan to vote on the deal later today, and the White House press secretary said President Barack Obama supports the deal.

“We fought the good fight,” House Speaker John Boehner, a Republican, said today on WLW, a radio station in his home state of Ohio. “We just didn’t win.”

Boehner said in a statement that Republicans won’t block the Senate compromise.

The agreement concludes a four-week fiscal standoff that began with Republicans demanding defunding of Obama’s 2010 health-care law and objecting to raising the debt limit and funding the government without attaching policy conditions. They achieved almost none of those goals in this agreement.

“This is far less than many of us had hoped for, frankly, but it’s far better than what some had sought,” said Mitch McConnell, the Senate minority leader, who said the measure retains Republican-preferred spending levels.

The framework negotiated by Majority Leader Harry Reid and McConnell would fund the government at those Republican-backed levels through Jan. 15, 2014, and suspend the debt limit until Feb. 7, setting up another round of confrontations then.

“This agreement achieves what is necessary,” said Jay Carney, the White House press secretary.

House Republicans

The Senate accord was unveiled a day after Fitch Ratings put the U.S. AAA credit grade on ratings watch negative, citing the government’s inability to raise the debt ceiling in a timely manner, according to a statement after markets in New York closed.

U.S. stocks rallied, sending the Standard & Poor’s 500 Index toward a record. The benchmark index rose 1.1 percent to 1,717.58 at 2:41 p.m. in New York after sliding 0.7 percent yesterday.

Rates on Treasury bills maturing in the next six weeks fell amid optimism lawmakers worked to resolve the fiscal impasse. Rates on $120 billion of bills maturing tomorrow dropped to 0.03 percent after rising as high as 0.36 percent yesterday.

One-month rates fell 21 basis points, or 0.21 percentage point, to 0.14 percent at 2:46 p.m. in New York after touching 0.45 percent, the highest since October 2008, according to data compiled by Bloomberg. The benchmark 10-year yield fell five basis points to 2.68 percent, according to Bloomberg Bond Trader data.

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