WASHINGTON, D.C. — The federal government is projecting that its borrowing needs for the current budget year will total $1.459 trillion, down 18.3 percent from the all-time high set last year.
The Treasury Department said Monday that it expects borrowing to total $340 billion for the current April-June quarter and $376 billion for the July-September period, the final three months in the government’s budget year.
The government’s financing needs for the full budget year are now expected to total $1.459 trillion, compared with the record of $1.786 trillion in the 2009 budget year.
The improvement from last year was credited in part to higher government tax collections reflecting an improvement from the last two years when government revenues had collapsed, reflecting a deep recession that has resulted in more than 8 million lost jobs, cutting into income collections, and also depressed corporate profits.
Treasury said that the big financial firms that handle government debt are now projecting that the federal deficit for this year will total $1.38 billion. That would be slightly lower than last year’s all-time record, a deficit of $1.4 trillion.
The Obama administration has not changed its official estimate for this year, which puts the deficit at $1.56 trillion for the current budget year, which began on Oct. 1 and will end on Sept. 30.
Last year’s deficit had pushed the government’s borrowing needs to an all-time high of $1.786 trillion, compared with borrowing of $760 billion that was done in 2008, a year the government ran a deficit of $454.8 billion.
The government’s new borrowing estimates were made in advance of the announcement Wednesday on just how the government plans to raise a large part of the borrowing for this quarter in a process known as a quarterly refunding.
The estimate of $340 billion in borrowing in the April-to-June period was up from an estimate made on Feb. 1 that borrowing needs for this quarter would total a lower $268 billion.
Treasury officials said much of the increase reflected a decision to return to using an emergency program created at the height of the debt crisis known as the Supplemental Financing Program.
That fund was created to give the Federal Reserve increased flexibility in managing its books but the government drastically cut back on the fund in late 2009 and early 2010 as it was approaching the old limit for the debt ceiling.
However, when Congress approved an increase of the debt limit to the current $14.3 trillion, up from $12.1 trillion last September, the Treasury Department announced that it was bringing back the special Fed fund and expected to keep it at a level of $200 billion.