Tags: budget | deficit | revenue | Boehner

Budget Deficit Shrinks on Rise in Revenue

Wednesday, 12 Feb 2014 02:50 PM

The U.S. budget deficit narrowed by 37 percent in the first four months of the fiscal year compared with a year earlier as spending declined and a stronger economy helped increase revenue.

Outlays exceeded receipts by $184 billion from October through January compared with a $290.4 billion shortfall in the same period a year earlier, the Treasury Department said today in Washington. Last month’s deficit was $10.4 billion, compared with a $2.9 billion surplus in January 2013.

The nation’s deficit as a share of the economy will shrink to a seven-year low in the 12 months ending Sept. 30, according to projections earlier this month by the Congressional Budget Office, which predicted a $10 billion deficit for January.

“The improving thrust in the underlying fiscal dynamics remains well in place and is essentially entrenched,” Millan Mulraine, deputy head of U.S. research and strategy at TD Securities USA LLC in New York, said before the report. “The improvement is coming mostly from increased revenue and that’s an indication that the economy is beginning to do well.”

Revenue rose 8.2 percent from October through January to $960.6 billion from the same period a year earlier, while outlays dropped 2.8 percent to $ 1.14 trillion in the fiscal year to date.

In January, receipts gained 8.7 percent to $296 billion, while spending expanded by 13.8 percent to $306.4 billion from a year earlier.

Payment Shift

Feb. 1 this year fell on a Saturday, requiring some government payments to be made in January instead of this month.

The CBO said Feb. 4 that the fiscal 2014 deficit will narrow to $514 billion, or 3 percent of gross domestic product, from $680 billion last year. The projected gap is down from 9.8 percent of GDP in 2009, the widest in records dating back to 1974.

The House of Representatives passed borrowing-limit legislation yesterday. Speaker John Boehner and many in his leadership team were among the 28 Republicans who joined with Democrats to pass a suspension of the debt ceiling until March 15, 2015.

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The U.S. budget deficit narrowed by 37 percent in the first four months of the fiscal year compared with a year earlier as spending declined and a stronger economy helped increase revenue.
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2014-50-12
Wednesday, 12 Feb 2014 02:50 PM
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