The U.S. deficit will fall to $492 billion this year, according to the Congressional Budget Office, down from $680 billion in fiscal year 2013.
The CBO revised its projection from $514 billion in February, “mostly because the agency now anticipates lower outlays for discretionary programs and net interest payments,” the office said in a
report released today.
The 2014 deficit will be 2.8 percent of the economy, according to the CBO, almost 32 percent below fiscal year 2013, when it was 4.1 percent. The deficit will shrink again in fiscal 2015 to $469 billion, before rising to about $1 trillion in fiscal years 2022 to 2024, the CBO said.
“This will be the fifth consecutive year in which the deficit has declined as a share of GDP since peaking at 9.8 percent in 2009,” CBO said. The 20-page report is an update of CBO’s 10-year baseline projections released in February.
The 2.8 figure as a percentage of gross domestic product is lower than the 3.1 percent average of the last 40 years, CBO said.
“If current laws do not change, the period of shrinking deficits will soon come to an end,” CBO said, citing an aging population, rising health-care costs, expanded federal insurance subsidies and interest payments on the national debt.
To contact the reporter on this story: Derek Wallbank in Washington at
dwallbank@bloomberg.net
To contact the editors responsible for this story: Jodi Schneider at
jschneider50@bloomberg.netLaurie Asseo, Justin Blum