The U.S. government’s monthly budget returned to deficit in May after a big April surplus, the Treasury Department said Wednesday, but the overall imbalance so far is much smaller than it was the same period last year.
The Treasury said that the May deficit totaled $130 billion after a surplus of $106.9 billion in April, a month when the government usually runs surpluses because of a flood of tax revenues.
For the first eight months of this budget year, the deficit totals $436.4 billion, down 30 percent from $626.3 billion for the same period in 2013. It was the smallest imbalance since 2008. The Congressional Budget Office (CBO) is forecasting a deficit of $492 billion for the full budget year ending September 30.
The government has run a deficit in May, a month when there are no major tax payments, for 59 out of the past 60 years. This year’s May deficit was slightly lower than the $138.7 billion deficit in May 2013.
The improvement this year reflects a stronger economy and labor market, which translates into more income and higher tax revenues. The government has also trimmed spending to gain control of soaring deficits in recent years.