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Economy in Brief

U.S. Budget Deficit Narrows Slightly In Q1 FY'11
by Tom Moeller   January 12, 2011

The U.S. Government's budget deficit during the first quarter of FY 2011, beginning last October, totaled $370.8B, according to figures released today by the U.S. Treasury and the Office of Management and Budget. That was slightly narrower than last year's $388.1B and its percentage of GDP similarly fell slightly to roughly 9.9% from 10.5% in last year's first quarter. For March alone, the deficit narrowed to $80.0B from $91.4B last year, slightly more-than-expected.

Receipts grew by 9.0% in Q1 '11 in a reversal of the prior year's decline. Leading the turn was a nearly one-quarter gain in individual income taxes. Earlier declines in employment levels have stabilized. Moreover, rental, proprietors', and dividend income each rose. Corporate income taxes rose 5.9% with higher profitability.

Reported outlays increased a modest 3.1% y/y. The gain in national defense spending picked in Q1 to 6.4% but spending elsewhere either slowed or declined. Notably, though the unemployment rate has not declined significantly, claims for unemployment insurance have eased.

Haver's basic data on Federal Government outlay and receipts and summary presentations of the Budget from both OMB and CBO are contained in USECON. Considerable detail is given in the separate GOVFIN database.

The Federal Reserve's latest Beige Book covering regional economic conditions can be found here.

US Government Finance Q1 2011 Q1 2010 FY 2010 FY 2009 FY 2008
Budget Balance $-370.8B $-388.1B $-1,294.1B $-1,417.1B $-454.8B
  as a percent of GDP -9.9 -10.5 -8.9 -10.0 -3.2
Net Revenues (Y/Y % Change) 9.0 -10.9 2.7 -16.6 -1.7
  Individual Income Taxes 23.2 -18.6 -1.8 -20.1 -1.5
  Corporate Income Taxes 5.9 -32.6 38.5 -54.6 -17.8
  Social Insurance Taxes -2.5 -2.2 -2.9 -1.0 3.5
Net Outlays (Y/Y % Change) 3.1 -0.5 -1.8 18.2 9.1
  Nat'l Defense 6.4 2.7 5.0 7.6 11.8
  Health 10.3 23.9 10.4 19.1 5.4
  Medicare 4.7 5.8 5.0 10.1 4.1
  Income Security -0.9 33.6 16.9 24.9 16.8
  Social Security -11.4 29.1 3.5 10.7 5.3
  Interest 8.5 -4.4 3.3 -24.5 6.3
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