June federal budget deficit hits $864 billion, smashing record

The U.S. budget deficit grew to a record $864 billion in June, up from just $8 billion in June last year, due to the cost of the government’s response to the coronavirus pandemic, the Treasury Department said on Monday.

Federal spending reached $1.1 trillion in the month, more than double the figure for a normal month. Tax revenue was essentially flat, partly because the Treasury Department pushed back the filing deadline from April to July.

The deficit for the first nine months of the current fiscal year has now ballooned to $2.7 trillion, $2 trillion of which was from shortfalls from April to June.

Economists said the spending was necessary.

“Big government deficits are the only thing keeping the U.S. economy on life support,” said Nathan Tankus, research director at the Modern Money Network.

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