Senate passes bill to prevent government shutdown

BY SourceMedia | MUNICIPAL | 11/16/23 01:36 PM EST By Connor Hussey

The Senate has passed a continuing resolution measure 87-11 that will keep the lights on until Jan. 19 and Feb. 2, avoiding a government shutdown this year, but increasing the stakes significantly for further funding discussions after the holiday season.

The measure will give Congress room to breathe as it deals with pressing concerns of how much aid to provide to Ukraine as well as the conflict in Israel, and to address Republican concerns about border funding. Avoiding a shutdown helps avoid disruptions for municipal issuers, who count on their working relationships with federal agencies.

"As of Friday night, the government is staying open," Senate Majority Leader Chuck Schumer, D-N.Y. said during a press conference following the vote. "And because of bipartisan cooperation, we're keeping the government open without any poison pills or harmful cuts to vital programs. A great outcome for the American people."

"Keeping the government is a good outcome, of course, but we have a lot more work to do after Thanksgiving," he added. "We must finish passing President Biden's emergency supplemental with aid to Israel, Ukraine, humanitarian assistance for innocent civilians in Gaza and funds for the Indo-Pacific. We will keep working with leader McConnell on a way forward."

Ten Republicans voted against the CR. Sen. Michael Bennet, D-Colo., was the only Democrat to vote against it, citing the lack of Ukraine funding.

Schumer noted Republicans are trying to squeeze funding for the border into that supplemental aid package and that he's working to see what they can come up with on a bipartisan basis. In addition to those big ticket items, the upcoming busy season will also be marked by a need to pass a supplemental defense authorization bill and the 12 appropriations bills currently making their way through Congress.

Speaker of the House Mike Johnson, R-La., who spearheaded the effort to get this off the ground this week, will have more troubles ahead due to his reliance on Democrats to get this measure to the Senate. President Biden is expected to sign the measure swiftly.

Sen. Patty Murray, D-Wash., who is also head of the Senate Appropriations Committee voted for the bill but said it would eventually "double the shutdown risk" when Congress resumes after the new year. The pressure to keep the government open for much of 2024 now goes back to Johnson, who indicated he's not interested in passing another CR.

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

fir_news_article