US Federal Government Posts Budget Surplus in June


CBO analysis notes that the US June 2014 figures were affected by the time-shifting of payments, without which, the monthly surplus would have been an estimated $35.0bn.

The US federal government reported a monthly budget surplus of $51.8bn for June, in line with CBO analysis and consensus expectations. Receipts were up 6.0% y/y for the month, while spending grew 15% y/y. The monthly surplus in June compares with $70.5bn reported for the same period last year.

Comparing these adjusted statistics shows the improvement in the US fiscal position over the past year. Growth in budget receipts over that time frame was driven by a 7% rise in individual incomes and payroll taxes, as well as 5% growth in corporate income taxes.

Outlays for entitlements, including Medicare (10% y/y), Medicaid (13% y/y), and Social Security (4% y/y), continue to drive aggregate spending; however, these spending items were offset by a $19.0bn receipt from spectrum auctions in June.  The June data bring the 12-month rolling deficit to $430.9bn, or about 2.4% of GDP.

"The deficits are expected to stabilize around current levels over the next quarter, in line with our FY 15 forecast for a federal deficit of $425.0bn", says Barclays.

Source : FX-Primus

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