• Reduction due to calendar shifts.

• Revenue decline led by a drop in personal tax receipts.

• Outlay surge driven by higher unemployment benefit payments.

The U.S. Treasury Department reported that the federal budget deficit declined to $145.3 billion during November compared to $208.8 billion twelve months earlier. The Action Economics Survey anticipated a $200.0 billion deficit for last month.

Federal government outlays rose 8.9% y/y two months into the new fiscal year compared to a 47.3% rise during all of FY 2020. The increase was driven by a 66.7% surge in income security payments so far in FY21 stemming from coronavirus relief payments and a higher unemployment rate. Spending on health care programs increased 18.0% y/y. Social security payments grew a lessened 4.2% y/y but defense outlays eased 0.1% y/y in FY21. Medicare payments declined 15.0% this fiscal year, although the decline largely reflected a weekend start date for the month. Interest payments eased 4.9% so far this fiscal year.

Overall revenues declined 2.9% y/y so far this fiscal year. The recession has lowered individual income tax payments by 12.8% y/y and corporate tax receipts by 16.1% so far in FY21. Growth in social insurance payments rose to 8.1% y/y, and the reduction in global economic trade lowered customs duties by 17.5% y/y.

Haver's data on Federal Government outlays are contained in USECON; detailed data can be found in the GOVFIN database. The Action Economics Forecast Survey numbers are in the AS1REPNA database.