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The U.S. Treasury Department announced on Thursday that the country's budget deficit for June reached $228 billion, marking a 156% rise compared to the previous year. The increase can be

attributed to weakening revenues and the acceleration of July benefit payments into June.

In June, receipts decreased by $42 billion or 9% from the previous year, amounting to $418 billion. On the other hand, outlays rose by $96 billion or 18% to $646 billion during the same period.

However, adjustments in the calendar resulted in $86 billion worth of July benefit payments being made in June, as July 1 fell on a weekend. Without these adjustments, the June deficit would have been $142 billion, reflecting a 66% increase compared to June 2022.

Looking at the first nine months of the 2023 fiscal year, which concludes on September 30, receipts decreased by $423 billion or 11% to $3.413 trillion compared to the same period last year. This decline can be attributed to lower non-withheld individual income taxes due to decreased capital gains in 2022, lower year-end salary bonuses, and significantly higher individual tax refunds as the Internal Revenue Service cleared a backlog of unprocessed receipts.

The Federal Reserve has experienced a $93 billion decrease in earnings this year due to higher interest payments on bank reserves and the absence of positive net income. A Treasury official stated that this situation is expected to persist.

Year-to-date outlays increased by $455 billion or 10% compared to the previous year, totaling $4.805 trillion. The rise in Social Security expenditures is mainly driven by cost-of-living adjustments, while interest on the public debt has increased by $131 billion or 25% to $652 billion due to higher interest rates.

Furthermore, outlays were also impacted by $52 billion in Federal Deposit Insurance Corp costs associated with the resolution of failing banks, according to a Treasury official. Photo by AgnosticPreachersKid, Wikimedia commons.