The last-minute deal to raise the debt limit averted a U.S. default, but it risks making brinkmanship over federal borrowing a seasonal event as lawmakers wage fiscal war in Washington. The agreement now awaits President Joe Biden's signature just before a June 5 default deadline, capping weeks of bitter negotiations that strained Treasury markets.

It will cost taxpayers as investors absorb a new normal.

The United States has had an extraordinary ability to borrow at low cost because global financial markets treat Treasury securities as the benchmark for risk-free debt. Yet at points in May, in the heat of the negotiations, investors demanded yields surpassing 7 percent on Treasury bills maturing around the projected default date, treating them as similar to junk debt.

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