US Congress seeks stopgap funding measure to avert govt shutdown

US lawmakers struggling to reach a critical pandemic relief and federal spending deal have struck a last-minute agreement to avert a midnight shutdown of the government.

The impasse over a $900 billion coronavirus aid bill and a $1.4 trillion government-wide spending bill through September 2021 threatened to temporarily shut down the government -- a scenario not unheard of in politically-divided Washington, but disastrous given the worsening economy and record death tolls from Covid-19.

To avert this, the House of Representatives voted 320 to 60 late Friday to extend funding for federal agencies through Sunday to allow negotiators to finish their stimulus package.

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The Senate passed the measure minutes later by voice vote, and it now goes to President Donald Trump to sign by the midnight deadline.

A package to aid struggling businesses and jobless workers is seen as critical to getting the world's largest economy back on its feet amid a resurgence of Covid-19 infections, even as new vaccines offer hope that an end to the pandemic may be in sight.

Without an agreement, millions of unemployed workers will lose their special pandemic benefits before the end of the year, and a moratorium on evictions is set to lapse within days.

After months of partisan finger-pointing and inaction, Republicans and Democrats have been negotiating intensely on what is expected to be the biggest package since spring to provide relief to a country struggling with a pandemic killing over 3,000 people a day.

With some support from Republican President Donald Trump, who leaves office on January 20, and Democratic President-elect Joe Biden, they have reported progress.

But enough differences remained that talks looked likely to stretch into the weekend.

Democrats warn that if the Fed's ability to extend lifelines is restricted, the fiscal crisis could be compounded in US states, particularly if Congress fails to pass assistance to state and local governments.

President-elect Joe Biden has pushed back fiercely against the Fed proposal, which reportedly would prevent the central bank from restarting emergency lending programmes that expire this year and could limit its response in future crises.

Lawmakers have yet to even see final language on the stimulus deal or the government funding package, and some warn that both need more time.

The pandemic package is expected to include aid for vaccine distribution and logistics, extra jobless benefits of $300 per week, and a new round of $600 stimulus checks -- half the amount provided in checks distributed last March.

(with inputs from agencies)