Monthly Budget Review: July 2025

The federal budget deficit totaled $1.6 trillion in the first 10 months of fiscal year 2025, the Congressional Budget Office estimates. That amount is $109 billion more than the deficit recorded during the same period last fiscal year. Revenues increased by $263 billion (or 6 percent), and outlays rose by $372 billion (or 7 percent).

The change in the deficit was influenced by the timing of outlays. Fiscal year 2024 outlays were reduced because payments that were due on October 1, 2023, a Sunday, were shifted into the prior fiscal year. (Those payments were made in September 2023.) If not for that shift, the deficit so far this fiscal year would have been $37 billion (or 2 percent) more than the shortfall at this point last year.

In January 2025, CBO projected that the deficit for fiscal year 2025 would be $1.9 trillion. Next month, in the Monthly Budget Review: August 2025, CBO will present updated projections for this fiscal year, which will account for actual spending and revenues reported through August and projections for the final month. The next edition of The Budget and Economic Outlook, covering the 2026-2036 period, will discuss the budgetary and economic effects of the recent reconciliation legislation, as well as the effects of tariffs, immigration, and other changes.