The federal budget deficit was $21.3 billion in December, the U.S. Treasury reported Wednesday, the smallest monthly shortfall since the Covid-19 crisis began nearly two years ago.
The narrower deficit was produced by a combination of higher tax receipts generated by a recovering economy and lower spending on relief and stimulus programs. Receipts rose sharply in December compared to a year earlier, up 41% to $487 billion, while outlays increased a more modest 4% to $508 billion.
The deficit so far for the current fiscal year, which began in October, totals $348 billion, about 30% smaller than at the same point a year ago.
The White House projects a deficit of $1.6 trillion in the 2022 fiscal year. That would be a historically high budget gap, but down sharply from the $2.7 trillion recorded in 2021 and $3.1 trillion in 2020.