WASHINGTON — The U.S. Postal Service (USPS) has canceled a plan to end Saturday letter delivery this summer, conceding Wednesday that Congress had won a recent legal bout over the agency’s attempt to cut costs.

The USPS had announced in February that letter delivery would drop to five days starting Aug. 5. But Congress responded by adding a rider on a spending bill mandating Saturday delivery. The Postal Service’s Board of Governors reviewed Congress’ decision and determined Congress had the authority to make it, it said in a news release Wednesday.

“Although disappointed with this congressional action, the board will follow the law,” the USPS said.

The Postal Service had intended to cut $2 billion a year from its budget with the service reduction, which would have ended Saturday letter delivery but retained package delivery, on which it makes money. Last year, the agency lost nearly $16 billion as it pleaded with Congress to approve changes that would improve its fiscal health. Congress failed to pass a bill, spurring the agency’s decision to drop to five-day delivery.

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The announcement followed disagreement between the agency and Congress over whether the agency’s decision to reduce service was legal in light of long-standing legislation that mandates Saturday delivery. The legal question revolved around whether the USPS would meet the requirement by continuing package delivery but not letter delivery.

The National Association of Letter Carriers, which has urged the USPS to improve its finances by expanding on strengths rather than cutting services, applauded the agency’s announcement Wednesday.