Treasury Budget: Pace of Improvement Slows

December 10, 2015
The Treasury Budget DEFICIT totaled $64.6 billion in November, in line with the consensus estimate of a deficit of $64.5 billion. This compared with a deficit in November 2014 of $56.8 billion. Part of the difference was accounted for by calendar effects that shifted some usual November payments into October. For the first 2 months of the fiscal year, the deficit has totaled $201.1 billion, an increase of $22.6 billion from the first 2 months of the last fiscal year. primarily because government spending increased modestly more than federal revenues. Receipts ROSE by 7.1% from its year ago level, primarily because of growth in corporate and individual income tax receipts. On a 12-month average basis, receipts have been slowly, but steadily, rising since January 2010. Outlays ROSE by 8.6% from its year ago level, partly because of the shift in the timing of certain payments. On a 12-month average basis, the trend in federal outlays is now turning modestly higher. After several years of declining unemployment benefit and military outlays, recent upticks in health and military are turning the trend. Bottom Line: With a moderate budget deficit this month -- the pace of improvement slowed after improving modestly in fiscal year 2015. Federal outlays have shown modest growth in the last 5 quarters after two years of declines. Receipts, meanwhile, continue to grow at a consistent pace.
Article by contingentmacro