The White House said Monday that the federal budget deficit for the current fiscal year will shrink to $759 billion. That’s more than $200 billion less than the administration predicted just three months ago.
The new figures reflect additional revenues generated by the improving economy and take into account automatic, across-the-board spending cuts that the White House had hoped to avert.
The White House projected that economic growth would be slightly slower in the coming years than it forecast in April. The report said the automatic spending cuts that kicked in during March will slow down economic growth this year from the 2.6 percent increase it forecast for the fourth quarter of this year to a 2.4 percent increase.
But the White House sees a slightly rosier jobs picture. It projects that unemployment will average 7 percent next year and reach 6.8 percent in the final quarter of 2014. That’s an improvement over the 7.2 percent unemployment it forecast in April as an average for 2014.
The 2013 budget year ending Sept. 30 will be the first one of Obama’s presidency in which the deficit won’t exceed $1 trillion.
A 2011 deficit-cutting deal with Republicans has pared deficits somewhat, as did a tax hike enacted earlier this year on upper-bracket earners.