CBO Projects Federal Budget Deficit to Reach $3.7 Trillion This Year
The Congressional Budget Office (CBO) projects the federal deficit to be “roughly $3.7 trillion in fiscal year 2020”.
At the beginning of March, projections for the year’s deficit was just over $1 trillion. Since then, passing of the CARES Act has been estimated to increase federal deficits “by about $1.8 trillion” in addition to affects from the other COVID-19 economic relief bills.
At the end of 2019, the federal budget deficit totaled $984 billion, an amount which Federal Reserve Chairman Jerome Powell said placed “the federal budget… on an unsustainable path”.
CBO’s projection also estimated Gross Domestic Product (GDP) “to decline by about 12 percent during the second quarter”. Similarly, the International Monetary Fund is projecting the global economy to contract by –3 percent in 2020, more than the global contraction of -0.6 percent during the 2008–09 financial crisis.