Treasury announced a -$119.7 B budget deficit for July
Treasury announced a -$119.7 B budget deficit for July, in line with our -$120 B projection as well as the CBO's. That compares to the -$76.9 B shortfall a year ago, and -$42.9 B the year before that. Spending rose to a 22.8% y/y pace, up considerably than the 9.9% y/y gain in FY2018. It's also twice the 11.6% y/y increase in July receipts (receipts declined -2.9% y/y in FY2018). For the 10 months of the fiscal year to date, the red ink totals -$866.8 B versus the -$684 B previously (and -$566 B in FY2017). Spending is 8.0% higher on a y/y basis for the year to date, versus 4.4% y/y in FY 2018. Year-to-date receipts increased 3.4% y/y compared to the 1.0% y/y gain last year. Analysts are forecasting a -$955 B deficit for fiscal 2019 with risk to the high side given the new budget agreement.