The U.S. budget deficit narrowed in October as calendar quirks lowered monthly spending on government benefit programs.
The federal government ran a $44.19 billion deficit in the first month of the new fiscal year, compared with $136.56 billion during the same month a year earlier, the Treasury said Thursday in its monthly report.
The one-month reading masks a broader trend of rising budget deficits. In fiscal year 2016, which ended Sept. 30, the budget shortfall reached $587.33 billion, about one-third bigger than in fiscal 2015.
As a share of gross domestic product, a broad measure of economic output, the deficit rose to 3.2% in fiscal 2016 from 2.5% the prior year. That was the first time since 2009, when the U.S. was emerging from the recession, the deficit rose in relation to economic output.
The Congressional Budget Office expects the deficit to widen to $594 billion in fiscal 2017.
In October, receipts grew 5% while outlays fell 24% compared with the same month a year earlier. The sharp dropoff in spending was largely because benefit payments-Medicare, for example-were shifted to another month so recipients would get their money on a weekday.
Adjusted for the calendar quirks in 2015 and 2016, the most recent October deficit shrank to $84 billion from the prior year’s $88 billion, Treasury said.