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April 12, 2021, 5:39 p.m. EDT

U.S. budget deficit soars to $660 billion in March after stimulus checks are sent out

Jeffry Bartash

The numbers: The U.S. budget deficit skyrocketed in March after the government approved a $1.9 trillion coronavirus-relief package that included $1,400 stimulus checks for most Americans.

The budget gap more than doubled to $659.6 billion in March from February, the U.S. Treasury Department said Monday. It was the third-highest monthly deficit ever recorded.

Read: CEOs warn Biden tax hike will hurt economy as battle lines drawn in Washington

What happened: Federal spending surged to $927.2 billion last month, a number only exceeded by record increase in outlays last spring at the onset of the pandemic.

The government shelled out hundreds of billions of dollars in stimulus checks, higher unemployment benefits and other social-welfare policies to help Americans get through the pandemic. The most recent bill signed by President Joe Biden was the third federal relief package since last year.

Tax revenues, meanwhile, totaled $267.6 billion in March. They rose 13% from the same month a year earlier, pointing to an ongoing recovery in the economy.

The U.S. deficit in the first six months of the current 2021 fiscal year climbed to $1.71 trillion. Before the pandemic struck in 2020, the U.S. never ran an annual deficit that reached that high.

The budget deficit last year was a record $3 trillion.

Big picture: The U.S. is likely to run huge deficits for at least the next few years as it copes with the fallout from the coronavirus pandemic. A Biden White House plan to spend $2.3 trillion on infrastructure and other initiatives would add to the national debt.

Market reaction: The Dow Jones Industrial Average (DOW:DJIA) and S&P 500 (S&P:SPX) declined in Monday trading.

Link to MarketWatch's Slice.