The U.S. federal deficit declined sharply in the first eight months of current fiscal year resulting from strong growth in revenues and slower increase of spending, the Commerce Department reported on Monday.
The department said that the U.S. federal deficit totaled 227 billion dollars through the first eight months of 2006 fiscal year which began from October 1, 2005, down by 16.7 percent from the same period in fiscal year of 2005, when the red ink totaled 272.3 billion dollars.
The U.S. government revenues totaled 1.545 trillion dollars in the first eight months by May, up 12.9 percent from a year ago. The government spending also increased but at a slower pace, up by 8 percent to 1.772 trillion dollars, compared to the same eight months in the 2005 budget year.
However, U.S. federal deficit surged by 42.8 billion dollars in May, 20.9 percent higher than the deficit in the same month of last year.
The U.S. Congressional Budget Office is forecasting that this year's deficit will be around 300 billion dollars, significantly below a previous estimate of 350 billion dollars.
U.S. government deficit totaled 319 billion dollars in fiscal year of 2005 which ended on September 30 of last year.