US budget deficit estimated to climb $1 trillion in next decade

The US budget deficit is expected to increase by $1 trillion in the next decade, according to a report by the non-partisan Congressional Budget Office (CBO).

The federal budget deficit is projected to grow from $1.6 trillion in fiscal year 2024 to $2.6 trillion in 2034, it said.

"Deficits also expand in relation to the size of the economy, from 5.6 percent of gross domestic product (GDP) in 2024, when the collection of certain postponed tax payments temporarily boosts revenues, to 6.1 percent of GDP in 2025," said the report that was released Wednesday.

"In 2026 and 2027, revenues increase faster than outlays, causing the deficit to shrink to 5.2 percent of GDP by 2027. Thereafter, outlays rise faster than revenues," it added.

The CBO said it expects the deficit to return to 6.1% of GDP by 2034, significantly larger than the 3.7% that deficits have averaged in the past 50 years.