Obama hails US budget deal

Barack Obama has hailed a deal to avoid a "fiscal cliff" of stark tax hikes and spending cuts. The US House of Representatives backed the bill by 257 votes to 167.

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Markets respond positively to US budget deal

Global markets have responded positively to the US 'fiscal cliff' deal of spending cuts and tax rises.

  • The FTSE 100 Index saw a rise of 1.5% up 93 points to 5990.
  • Hong Kong's Hang Seng index jumped by more than 2% to its highest level in 18 months.
  • South Korea's Kospi rose by 1.7%
  • Australia's ASX 200 rose 1.2%.

Economists had feared that, without action by Congress, the tax increases and spending cuts that technically took effect on New Year's Day would cause unemployment to surge and send the US economy back into recession.

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