The U.S. government’s budget deficit narrowed in November from the same month last year, helped by an improvement in tax receipts.
The $137.3-billion shortfall is smaller than the $150.4-billion deficit posted in the same month last fiscal year, according to Treasury Department statistics released in Washington. Economists projected a $139.9-billion gap, according to the median estimate in a Bloomberg News survey.
“We’re seeing some signs of better economic growth,” says Gary Thayer, chief macro strategist at Wells Fargo Advisors LLC. “We are hoping to see some modestly better revenue figures. Still, we would need to see a much stronger economy to bring down the deficit.”
The report follows the failure of a 12-member bipartisan supercommittee of the U.S. Congress to agree on ways to close the federal deficit, potentially triggering $1.2 trillion in automatic budget cuts. Barring action to thwart the reductions, spending on defense, education, transportation and the environment will face automatic cuts.