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Deal reached on financial markets bailout

Congressional leaders and the Bush administration have reached a tentative deal on a bailout of imperiled financial markets that could cost taxpayers hundreds of billions of dollars.

world Updated: Sep 28, 2008 12:10 IST

Congressional leaders and the Bush administration have reached a tentative deal on a bailout of imperiled financial markets that could cost taxpayers hundreds of billions of dollars.

The House could vote on it today and the Senate on Monday. House Speaker Nancy Pelosi announced the accord just after midnight last night and said it still has to be put on paper. Treasury Secretary Henry Paulson talked of finalising the deal but added: "I think we're there."

The plan would spend up to US$ 700 billion, most of it on buying deeply devalued mortgages from the housing market's collapse and other bad loans held by tottering banks and other investors.

The aim is to prevent credit from drying up and causing a meltdown of the US economy.