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Illinois Debt-Default Insurance Climbs to Record High

The cost of insuring Illinois bonds against default rose to a record high as state lawmakers confront a $13 billion budget gap for the year starting July 1.

The price of a five-year credit-default swap to insure Illinois obligations rose 7 basis points to 309.1 basis points today, or $309,100 to protect $10 million of debt, from 302.2 basis points yesterday in New York, according to CMA DataVision, a data provider owned by CME Group Inc. The gain makes insuring bonds from the fifth-most populous state more expensive than covering debt from any other municipal issuer.