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Economy in Brief
EMU and Other Central Banks: The Inflation Conundrum
Inflation in the EMU has flared and was last higher in September 2008...
U.S. Retail Sales Improve in August
Total retail sales including food service and drinking establishments increased 0.7% (15.1% y/y) during August...
U.S. Business Inventories and Sales Rise in Tandem in July
Total business inventories increased 0.5% (7.2% y/y) during July...
Philadelphia Fed Manufacturing Index Rebounds in September
The Federal Reserve Bank of Philadelphia's Manufacturing Business Conditions Index jumped 11 points in September to 30.7...
U.S. Unemployment Insurance Claims Rise But Remain Near Pandemic Low
Initial claims for unemployment insurance increased to 332,000 (-61.4% y/y) during the week ended September 11...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller August 11, 2021
• July budget deficit is larger than expected.
• Receipts from individuals & corporations remain strong.
• Income security outlays are firm.
The U.S. Treasury Department reported a federal budget deficit of $2.540 trillion for the first ten months of FY 2021. This compares to a $2.807 trillion deficit over the same period last year. For July alone, the deficit totaled $302.1 billion compared to the July '20 deficit of $62.99 billion. Expectations had been for a $199 billion deficit in the Action Economics Forecast Survey.
Overall revenues have increased 17.5% y/y so far this fiscal year. Individual income tax receipts increased 25.6% y/y in FY'21 as employment & earnings continued to grow. The increase was held back by a delayed tax deadline in 2020. Corporate tax payments strengthened 76.2% y/y with improved business profitability. Social insurance taxes eased 1.0% y/y but customs duties improved 14.6% y/y so far in FY'21.
Federal government outlays have risen 4.0% y/y so far in FY'21. The increase includes a winding down of income security payments due to COVID-19. Spending on health programs grew 4.9% y/y so far this fiscal year. Defense outlays rose 4.5% y/y so far in FY'21 while Social Security payments increased 3.6% y/y. Medicare payments declined 10.6% y/y while interest payments rose 2.3% y/y so far in FY'21.
Haver's data on Federal Government outlays are contained in USECON; The expectations figure is the AS1REPNA database.
| United States Government Finance | July | FY'20 | FY'19 | FY'18 | FY'17 | |
|---|---|---|---|---|---|---|
| Budget Balance (Billion $) | -- | -$302.050 | -$3,131.92 | -$984.39 | -$779.00 | -$665.83 |
| Fiscal YTD | -- | -$2,540.0 | -- | -- | -- | -- |
| % of Total (FY 2020) | ||||||
| Net Revenues (Fiscal Year YTD 2021, Y/Y % Change) | 100 | 17.5 | -1.2 | 4.0 | 0.4 | 1.5 |
| Individual Income Taxes | 47 | 25.6 | -6.4 | 2.0 | 6.1 | 2.7 |
| Corporate Income Taxes | 6 | 76.2 | -8.0 | 12.5 | -31.1 | -0.8 |
| Social Insurance Taxes | 38 | -1.0 | 5.4 | 6.2 | 0.8 | 4.2 |
| Customs Duties | 2 | 14.6 | -3.2 | 71.4 | 19.4 | -0.8 |
| Net Outlays (Fiscal Year YTD 2021, Y/Y % Change) | 100 | 4.0 | 47.3 | 8.2 | 3.2 | 3.3 |
| National Defense | 11 | 4.5 | 5.6 | 8.8 | 0.1 | 6.1 |
| Health | 11 | 4.9 | 28.0 | 6.1 | 9.8 | -1.9 |
| Medicare | 12 | -10.6 | 19.2 | 10.6 | -1.4 | 0.6 |
| Income Security | 19 | 33.5 | 145.0 | 3.9 | -1.6 | -2.1 |
| Social Security | 17 | 3.6 | 4.9 | 5.7 | 4.5 | 3.1 |
| Veterans Benefits & Services | 3 | 7.7 | 9.3 | 11.9 | 1.3 | 1.2 |
| Education, Training, Employment & Social Services | 4 | -0.7 | 75.5 | 43.7 | -34.0 | 31.6 |
| Interest | 5 | 2.3 | -8.2 | 15.7 | 23.6 | 9.1 |
