A view from the United States Treasury Department of the Treasury Building in Washington DC, United States, December 30, 2024. The US Treasury Department was cyberattacked by a Chinese state actor in early December.
Celal Gunes | Anadolu | Getty Images
The federal budget sank further into the red during December, leaving the deficit in the first fiscal quarter nearly 40% higher than a year earlier.
In the last calendar month of 2024, the shortfall totaled $86.7 billion, actually a 33% drop from the same period a year earlier, according to a Treasury Department report released Tuesday. However, this brought the three-month fiscal year total to $710.9 billion, about $200 billion more than the comparable period last year, or 39.4%.
Rising financing costs coupled with continued spending growth and declining tax receipts have combined to spiral the deficit, pushing the national debt past the $36 trillion mark.
Although yields on short-term government bonds have remained fairly stable over the past month, rates at the extreme end of the duration curve have risen. The benchmark 10-year bond recently yielded close to 4.8%, or about 0.4 percentage points higher than a month ago.
At the same time, expenditures during the first quarter were 11% higher than a year ago, while receipts fell by 2%.
Interest on the national debt totaled $308.4 billion in fiscal year 2025, up 7% from a year earlier. Funding costs are forecast to exceed $1.2 trillion for the full year, surpassing the record set in 2024.
The government spent more this year on interest payments than any other category except Social Security, defense and health care.
