Federal Deficit Shrinks in January

The US Department of the Treasury reported today that the US budget deficit for the month of January totaled $27.4 billion, down dramatically from the deficit of $49.8 billion in January 2011. About half the improvement is due to the timing of federal benefits payments.

Treasury receipts in January totaled $234 billion, while spending totaled $276 billion.

The federal deficit for the fiscal year ending in September is expected to be about $1.1 trillion, slightly lower than the $1.3 billion deficit in fiscal year 2011. In the first four months of this fiscal year the federal deficit totaled $349 billion, about $70 billion less than in the same period a year ago.