adminWASHINGTON. – The US budget deficit is likely to fall by $60 billion in 2015 due to strong revenue gains, the Congressional Budget Office said yesterday, adding that the government may be able to pay its bills without a debt limit hike through early December.
The CBO said it now estimates a $426 billion deficit for fiscal year 2015, down from its $486 billion forecast made in March. It also forecast a fiscal 2016 deficit of $414 billion, a reduction of $41 billion.
The gradually shrinking deficits may temper some demands in Congress for deeper spending cuts or weaken resistance to lifting the “sequester” spending caps on discretionary programs as lawmakers consider spending legislation for the 2016 fiscal year, which starts October 1. The stronger-than-forecast tax collections also mean that the US Treasury’s extraordinary cash management measures, employed since a debt limit extension expired in March, can stave off a federal default on payment obligations a bit longer.
CBO previously said that the Treasury would likely exhaust all remaining borrowing capacity in October or November. In its latest guidance, it said that deadline will now likely come between mid-November and early December due to the additional revenues. – Reuters.
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