The numbers: The U.S. federal budget deficit narrowed to $87.8 billion in October, down from $165.1 billion in the same month last year, the Treasury Department said Wednesday.
This is the first month of the new fiscal year.
Key details: Government spending rose $406. 4 billion in the month, down from a rise of $489 billion in the same month last year. The largest outlay was for Social Security, followed by $77 billion for national defense and $70 billion for health spending.
Interest on the federal debt jumped to $47.6 billion in October from $18.9 billion in the same month one year ago.
Revenue totaled $318.6 billion in October, up from $283.9 billion in the same month a year ago.
Big picture: The annual budget deficit narrowed to $1.38 trillion in the fiscal year that ended in September. That’s down from $2.77 trillion in the prior year. Spending was much lower as the pandemic eased.
Economists don’t expect much improvement this fiscal year.
Congress has not passed an actual budget in the past seven fiscal years, said Maya MacGuineas, president of the Committee for a Responsible Federal Budget.
Congress must also increase the federal debt ceiling sometime in the next 13 months.