US Senate approves deal on debt increase

The US Senate has approved legislation to temporarily raise the federal government's $US28.4 trillion ($A38.8 trillion) debt limit and avoid the risk of a historic default later this month.

It put off until early December a decision on a longer-lasting remedy, with the Senate voting 50-48 to pass the bill following weeks of partisan fighting.

The $US480 billion ($A657 billion) increase to the current debt limit is expected to be exhausted by December 3, the same day funding for most federal programs also expires under a stop-gap measure passed earlier this month following another standoff.

That means over the next eight weeks the bitterly divided Congress will have the twin challenges of finding some middle ground on agency spending through to September 2022 - ranging from education and foreign aid programs to immigration enforcement and airport security - as well as avoiding yet another debt-limit meltdown.

The vote followed a months-long standoff bringing the nation close to the October 18 date from when the Treasury Department forecast it would no longer be able to meet its financial obligations.

"Republicans played a dangerous and risky partisan game and I am glad that their brinksmanship did not work," Senate Majority Leader Chuck Schumer said after the vote.

The Senate-passed bill now goes to the House of Representatives, where it is expected to be approved. It is unclear how quickly the House might act.

Austrlaian Associated PressBack to Breaking News

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