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July 1, 2021, 2:20 p.m. EDT

U.S. budget deficit will hit $3 trillion this year, CBO projects

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By Robert Schroeder

The federal budget deficit for fiscal year 2021 will be $3 trillion, the nonpartisan Congressional Budget Office estimated Thursday. That's nearly $130 billion less than last year's shortfall but triple the deficit recorded in 2019, as Washington responds to the coronavirus pandemic. The CBO said this year's deficit would total 13.4% of GDP, making it the second-largest since 1945 and exceeded only by last year's shortfall. Separately, the CBO said GDP would increase by 7.4% by the end of 2021, as the pandemic eases and demand for consumer services surges.

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