Deal is close on student loan rates
WASHINGTON An emerging deal to lower interest rates on student loans took shape Thursday, offering Democrats promises that interest rates would not reach 10 percent and giving Republicans a link between borrowing terms and the financial markets. Lawmakers and their aides were in talks about how they might reduce rates on subsidized Stafford loans, which doubled to 6.8 percent last week in the wake of congressional inaction. Efforts to restore those rates to 3.4 percent were abandoned in favor of a new compromise that bears many similarities with a bill that House Republicans have passed, and with President Barack Obama’s budget proposal. Under the plan, interest rates on new loans would be based on the 10-year Treasury note, plus an additional percentage to pay for administrative costs. The proposal includes a limit on how high rates could climb, a demand Democrats said was a deal-breaker. Undergraduate students would see rates around 4 percent this fall and would see them capped at 8.25 percent in future years. Graduate students and parents would see rates capped at 6 percent this fall and 9.25 percent in coming years.
June retail sales encouraging
NEW YORK June sales heated up for stores, in a sign that Americans likely will continue to spend during the important back-to-school shopping season. U.S. retailers reported their strongest sales gains since January, as shoppers, enticed by warm weather and an improving economy, took advantage of summer discounts. Revenue at stores open at least a year - an industry measure of a retailer’s health - rose 3.9 percent in June compared with the same month a year ago, according to a preliminary tally of 12 retailers by the International Council of Shopping Centers. The mall trade group had expected an increase of 3 to 3.5 percent. The data, released Thursday, offers positive signs for the back-to-school season, which is the second-biggest shopping period behind the winter holidays.
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More flights running late
Summer travelers should pack plenty of patience: More flights are running late this year than in 2012. The U.S. Department of Transportation says that only 79.4 percent of domestic flights arrived on time in May, down from 83.4 percent in the same month last year. Hawaiian Airlines was most likely to arrive on-time, while American Eagle, the regional-flying affiliate of American Airlines, had the worst rate. Among the five largest U.S. airlines, Delta had the best on-time record, followed by US Airways, United, Southwest and American. Five planes were stuck on airport tarmacs for more than three hours, which is longer than allowed by federal regulations. Cancelations ticked up slightly from a year ago.
The Associated Press contributed.