The FINANCIAL — The U.S. budget deficit widened in November due to an uptick in spending that outpaced an increase in revenues, the Treasury Department said on December 10, according to Nasdaq.
The deficit over the 12 months ended November stood at $461 billion, or around 2.6% of gross domestic product. The figure is up from $436 billion one year earlier, or 2.5% of GDP. Deficits have fallen this year to their lowest levels since 2008, but November marked the second time this year in which deficits nosed above their year-earlier level.
The latest report showed that revenue growth has flattened out in recent months. For the 12 months ended November, it stood 7.1% above the year-earlier level, near its slowest rate of increase in three years.
Outlays, meanwhile, were up 6.9% over the same period, the fastest rate of growth since early 2010, after the federal government completed its round of economic stimulus following the financial crisis.
Most of the spending growth in recent months has been driven by programs that aren’t appropriated on an annual basis by Congress, such as Medicare and Social Security.
The government ran a $65 billion deficit in November, a month in which the U.S. has almost always run a deficit since the 1950s. The increase was around 28% ahead of last year’s deficit after adjusting for certain calendar differences that affect the timing of certain payments.
Last month, President Barack Obama signed into law a bipartisan agreement that slightly boosts discretionary spending caps through Sept. 30, 2017, which could boost near-term deficits if revenues don’t rise by a similar amount.
Funding for the federal government is set to expire on Friday, and congressional leaders are preparing a stopgap measure that would keep the government open for another week or so, giving lawmakers more time to complete spending bills at the levels agreed to last month.
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