The United States budget showed a surplus in January for the first time since 2019. But the total debt broke through a record at more than 30 trillion dollars.
(Boursier.com) — The budget balance of the United States emerged in surplus by 119 billion dollars in January, an amount higher than consensus expectations, which had forecast +25 billion dollars. A year earlier, in January 2021, the US budget showed a deficit of $163 billion.
This is the first monthly budget surplus since September 2019, before the coronavirus crisis. According to figures from the Treasury Department, published Thursday evening, expenditure reached $346 billion in January 2022, down more than 36% over one year, while revenue totaled $465 billion (+20%). This improvement is the result of an increase in tax receipts thanks to the economic recovery and the reduction in expenditure linked to the pandemic.
These figures come after a sharp reduction in the budget deficit in the first fiscal quarter (October-December). Over the first 4 months of the current financial year (which will end at the end of September 2022), the budget still shows a deficit of $259 billion, but the deficit has been divided by almost three compared to that of the same period of 2021 (-$736 billion).
Record debt of $30 trillion as interest rates rise
Despite this budgetary improvement, the federal debt continued to increase, with the State borrowing $259 billion over the first 4 months of the financial year. The total debt of the United States thus exceeded in January for the first time the 30,000 billion dollarsthe Congressional Budget Office (CBO) said on Tuesday.
This level is considered “unsustainable” in the medium term by Federal Reserve Chairman Jerome Powell, especially as the Fed is preparing to raise its key rates to curb inflation. On the sovereign debt markets, US government bond rates have risen sharply in recent weeks, in the face of soaring inflation which reached 7.5% in January in the United States.
The performance of Two-year Treasury bonds have more than doubled since the end of December, reaching 1.5% this week, and the 10-year yield has fallen from 1.5% to 2% since the start of the year… Enough to further increase the weight of debt service in the coming months.
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