The legislation, approved in a 221-201 vote, would suspend the debt ceiling until March 15, 2015, allowing the Treasury Department to issue new debt above the current USD 17.2 trillion cap, media reported.

The bill eliminates the threat of default and puts off debate on the issue till after the 2014 midterm elections.

It signifies a retreat from a long-held Republican strategy of seeking concessions in exchange for a debt-limit increase, delivering victory to US President Barack Obama who has demanded a debt limit hike without conditions.

House Speaker John Boehner told reporters on Tuesday morning that he would advance a "clean" debt-limit bill to the House floor, abandoning a proposal circulated on Monday which would have linked the debt limit increase with a reversal of military benefits cuts.

Without an increase in the statutory borrowing limit, US government would face the threat of a historic default that could wreak havoc in global financial markets and hurt economic recovery.

The Democratic-controlled Senate would hold a vote on the bill on Wednesday. Congressional Democrats have long insisted the debt limit be raised with no strings attached.

(Agencies)

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