Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Federal deficit falls to $42 billion in January

By Chavon Sutton, staff reporter


New York (CNNMoney.com) -- The U.S. government posted a $42.6 billion deficit in January, the Treasury Department reported Wednesday, marking the 16th month in a row that U.S. government operations have been in the red.

January's shortfall brings the total deficit for the first 4 months of fiscal year 2010 to $430.7 billion, up from $395.9 billion during the prior year period.

Last month's deficit was lower than the $91.9 billion shortfall reported in December, and came in below the $63.5 billion deficit reported in January 2009.

"[The deficit reflects] the cost of fighting the financial crisis and recession," said Gus Faucher, director of macroeconomics for Moody's Economy.com.

Driving the fiscal 2010 deficit is the fact that tax revenues have fallen faster than government spending. In the first four months of the fiscal year, government receipts fell by $80.5 billion compared to the year before, while outlays only decreased by $45.7 billion from the same period.

Interest paid on federal debt in January was $18.9 billion or 7.6% of federal outlays for the month.

The Treasury Department forecasts a deficit of over $1.56 trillion for the full fiscal year of 2010, up from $1.42 trillion in 2009.

Debt ceiling: In a sign of rising fiscal pressure, the House earlier this month approved a record $1.9 trillion increase in the cap on how much the government can borrow, bringing the new debt ceiling to approximately $14.3 trillion, which is expected to cover the Treasury's borrowing needs into 2011.

Debt held by the public neared $12.3 trillion as of Feb 12, the most recent date for which a figure is available, roughly $2 trillion below the legal debt limit.  To top of page

Search for Jobs

Index Last Change % Change
Dow 18,454.30 -48.69 -0.26%
Nasdaq 5,222.99 -9.34 -0.18%
S&P 500 2,176.12 -4.26 -0.20%
Treasuries 1.57 0.00 0.26%
Data as of 9:00pm ET
Company Price Change % Change
Bank of America Corp... 16.19 0.35 2.21%
EMC Corp 28.99 0.32 1.12%
Chesapeake Energy Co... 6.51 0.07 1.09%
Freeport-McMoRan Inc... 10.56 -0.42 -3.83%
Ford Motor Co 12.55 0.08 0.64%
Data as of 4:02pm ET
Sponsors

Sections

Martin Shkreli, the reviled drug company CEO who faces federal criminal charges, nearly doubled his $3 million investment in KaloBios. More

Donald Trump has said he doesn't want to touch Social Security or other entitlements. And his campaign says he'd "protect" it. But a key economic adviser thinks the candidate 'might do something different' if he's elected 'because you have to do something different.' More

Uber has hired on Jeff Jones, formerly chief marketing officer of Target, to serve as president of the company. More

With a veto from Gov. Chris Christie, the "Fight for $15" was dealt a setback in New Jersey. But legislators may sidestep Christie and put the question directly to voters in 2017 as to whether they would like to increase the state's minimum wage to $15. More