March budget deficit is nearly a third of what it was one year ago
The federal government's budget deficit in March was $65 billion, Treasury said moments ago, nearly one-third the budget deficit one year ago.
March income was $153 billion, while spending came in at $219 billion, Treasury said. The income figure is up 19 percent over last March, as tax receipts came in higher than expected, as a result of the ongoing recovery.
In March 2009, the budget deficit was $192 billion, as tax revenue plunged and federal bailout spending surged.
Treasury officials say it looks like the cost of the bailout is less than expected. In turn, this means the government might be able to sell fewer Treasurys to fund its deficit/debt.
It's unclear whether this will be a one-time downward dip or the beginning of something long term. According to a story in the New York Times over the weekend, bond king Bill Gross of Pimco is liquidating his portfolio of U.S. Treasurys like there's no tomorrow, because he believes interest rates are on the rise, meaning the government will have to sell more Treasurys, which lowers prices and makes them less valuable.
Half of Gross's portfolio was made up of Treasurys; now that number is down to 30 percent, the Times reports.
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April 12, 2010; 2:30 PM ET
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Posted by: bandcyuk | April 12, 2010 6:06 PM | Report abuse
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