US Government Budget Deficit Sharply Narrows More Than Expected

The US budget deficit sharply narrowed to USD 21.3 billion in December 2021, compared with a USD 143.5 billion gap in the same period last year and market expectations of a USD 25 billion gap. Outlays increased 3.7 percent to USD 508.04 billion, while receipts soared 40.6 percent to USD 486.2 billion.

The U.S. government’s budget has been complicated by the coronavirus. But the deficit is shrinking as federal stimulus spending fades. The new reading is thanks to surging tax revenue and tightening the monetary policy by the Federal Reserve.

The U.S. deficit shrank from $144 billion in the same month of 2020, the Treasury Department said Wednesday. The federal government’s fiscal year began on 1 October. Tax revenue increased a whopping 41% to $487 billion.