Analysts at Nomura note that the US treasury reported a budget deficit of $100.5bn in October, the first month of FY19, up from $63.2bn in October 2017.
Key Quotes
“Part of the increase relative to this time last year involved a shift in the timing of certain payments. The Congressional Budget Office (CBO) reported that, if not for that shift, the deficit in October would have been roughly $9bn less than in October 2017.”
“Receipts from customs and duties increased sharply to $5.6bn, consistent with the recent imposition of tariffs by the Trump administration. On a y-o-y basis, receipts increased 7.4% while spending increased 18.3%.”
“We expect the budget deficit to widen in FY19 to $970bn, up from $780bn in 2018, a result of tax cuts and increased federal spending by the Trump administration.”
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