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US budget deficit shrank $1.7 trillion through June

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The US budget deficit plunged by 77 percent in the first nine months of the fiscal year, as the pandemic recovery brought in more tax revenues and Covid-19 spending wound down.

The budget gap fell $1.7 trillion to $515 billion for the October-June period, the Treasury Department said Wednesday.

As the economic recovery from the Covid-19 pandemic has picked up steam and companies return to normal, government outlays on unemployment benefits dropped sharply, while tax receipts from individuals and families picked up.

Outlays dropped 18 percent compared to the prior fiscal year, with Labor Department spending down 87 percent, according to the report.

Receipts jumped 26 percent, the data show, amid higher tax payments.

However, as surging inflation has led to a steep increase in borrowing costs, interest on the public debt jumped 24 percent.

Consumer prices in June soared 9.1 percent, cementing the likelihood the Federal Reserve will continue to aggressively raise the benchmark lending rate.

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AFP

Agence France-Presse (AFP) is a French state-owned international news agency based in Paris. It is the world's oldest news agency, having been founded in 1835 as Havas.




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