In brief: Deficit dips; long-term outlook remains dim

WASHINGTON – The federal deficit continues to decline thanks to budget cuts, slower growth in Medicare costs and increased tax revenue, but the nation’s long-term fiscal outlook remains troubled, according to a report Wednesday from the Congressional Budget Office.

At $506 billion for fiscal 2014, the federal deficit is much smaller than those of recent years and is now 2.9 percent of gross domestic product – down from a high of 10 percent of GDP in 2009 during the recession.

Though economic growth has lagged at an average annualized rate of less than 1 percent for the first half of the calendar year, the CBO said it expects stronger economic activity in the second half will push growth to 1.5 percent for the year. The unemployment rate is expected to continue to decline, it said.

Despite improvements in the economic outlook after years of fiscal battles between Congress and the White House, the nonpartisan budget office warned that long-term projections remain dim.

The forecast released Wednesday shows a slightly higher budget deficit for the year than was projected in April, as revenue dropped “mostly because of lower than anticipated receipts from corporate income taxes.”

Spiders cause recall of Suzuki midsize cars

DETROIT – Spiders have forced Suzuki to recall more than 19,000 midsize cars.

The automaker said spider webs can clog a fuel vapor vent hose in some 2010 to 2013 Kizashi cars, cutting off air flow. If that happens, it can cause the gas tank to deform, causing cracks, fuel leaks and possible fires.

The recall was prompted by seven reports of the problem. Service centers will replace the vent line with one that has a filter on the end. They’ll also replace gas tanks if necessary.

The problem hasn’t caused any accidents or injuries in the U.S., Suzuki said in documents posted Wednesday by the National Highway Traffic Safety Administration.

Owners will be notified this month.

SAN JOSE, Calif. – A federal judge has rejected Apple’s attempt to block the sale of several older Samsung smartphones that copied features in the iPhone.

Wednesday’s rebuff comes nearly four months after a jury awarded Apple Inc. $119 million in damages for Samsung’s infringements on technology used in the trend-setting iPhone. The amount was well below the $2.2 billion in damages that Apple had been seeking in the latest round of legal wrangling between the world’s two leading smartphone makers since the tussle began four years ago.

Apple wanted U.S. District Judge Lucy Koh in San Jose to issue an order that would have prevented future U.S. sales of nine Samsung phone models that infringed on the iPhone technology.

Koh refused, saying Apple hadn’t adequately proven Samsung’s intellectual theft had hurt its sales or diminished its reputation for innovation.

Kia Motors will open a $1.5 billion auto plant in northern Mexico in 2016, with the capacity to build 300,000 vehicles annually, Mexican President Enrique Pena Nieto announced Wednesday.

The factory will be built in the city of Pesqueria in the border state of Nuevo Leon.

“It is the first investment by the Korean auto industry in our country,” Pena Nieto said, noting that parts of the country have enjoyed a boom in automotive production financed by U.S. and Japanese firms.