U.S. immigration focus on the U.S. economic circle: According to news from Beijing on the early morning of June 13, the U.S. Department of the Treasury released a report on Wednesday stating that the U.S. budget deficit for May was $139 billion, an 11% increase year-on-year. However, it is still expected that the full-year budget deficit will fall below $1 trillion for the first time since 2008.
In the monthly budget report released today, the U.S. Department of the Treasury stated that the May budget deficit increased by 11% compared to the same period last year, primarily due to an increase in government spending. The growth in overall U.S. government spending in May was mainly driven by higher expenditures on defense, veterans' benefits, and other projects compared to the same period last year. Meanwhile, in the first eight months of the current fiscal year, the budget deficit has declined compared to the same period last year, due to a significant increase in tax revenue.
The report shows that for the current fiscal year to date, the U.S. government's budget deficit has fallen by 26% compared to the same period last year. In the year ending in May, U.S. government tax revenue grew by 15%, largely influenced by tax rate increases that took effect in early 2013.
According to projections by the non-partisan Congressional Budget Office (CBO), the May budget deficit was $139 billion; for the entire 2013 fiscal year, the committee predicts a U.S. government budget deficit of $642 billion, marking the lowest level since 2008, when the deficit was $455 billion. This means the budget deficit will break the four-year streak of exceeding $1 trillion annually. Compared to recent years, a full-year deficit of $642 billion would represent a significant improvement. In fiscal year 2012, the U.S. government's budget deficit was $1.1 trillion, and in 2009, it reached a record high of $1.4 trillion.
The Treasury report shows that U.S. government spending in May was $336 billion, with revenue of $197 billion. The U.S. government's fiscal year begins in October each year and ends in September of the following year.
The decline in the deficit is expected to reduce the likelihood of U.S. government officials engaging in a so-called “grand bargain” negotiation on deficit reduction this year. On Monday, the rating agency Standard & Poor's released a report upgrading the outlook for the U.S. long-term sovereign credit rating to “stable,” which will ease the pressure on the U.S. Congress to reach a deficit-reduction agreement. However, members of the U.S. Congress are not in a hurry to declare that the “war” on deficit reduction has been won.
Paul Ryan, Chairman of the House Budget Committee, said on Wednesday that the U.S. still faces a debt crisis and strongly advocated for cost savings on entitlement programs. Ryan's remarks may indicate that he will push for spending cuts in future negotiations regarding raising the federal government's debt ceiling or the next fiscal year's budget bill.
U.S. Treasury Secretary Jacob Lew previously stated that the government could use extraordinary measures to ensure it does not default after Labor Day (the first Monday in September).