Three stories making news across the Midwest today:
1. How default may affect Chicago. The city of Chicago plans to borrow $800 million later this year. A short-term debt default wouldn’t affect those plans, but could affect interest rates. Crain’s Chicago Business analyzed what a downgrade of the federal government’s credit rating would mean for the city and state of Illinois: the addition of “hundreds of millions of dollars in interest costs to bonds.”
2. Demand for manufactures goods falls. Orders for U.S. manufactured goods fell in June and another barometer of business spending declined, deepening worries that the economy’s current slump could worsen. The Commerce Department said Wednesday that durable-goods orders fell 2.1 percent, according to Reuters. That follows a 1.9 percent increase in May. Capital goods orders, excluding aircraft, fell 0.4 percent in June.
3. Fuel-economy deal ahead. Officials in the Obama administration say recent changes will make it easier to reach a deal with automakers to increase fuel economy. A proposal for light trucks to get 56.2 miles per gallon by 2025 has been lowered to 54.5, according to the Associated Press. Last week, Michigan lawmakers said the higher proposal was “overly aggressive.” In 2009, automakers reached an agreement to boost fuel-economy standards to 35.5 miles per gallon by 2016.