The final outlay could also differ substantially from the CBO's current projections, largely contingent on a Supreme Court case concerning the cancellation of outstanding student loan debt, CBO said in a report titled ‘An Update to the Budget Outlook: 2023 to 2033’.

Looking ahead, the CBO’s updated projections show annual deficits nearly doubling over the next decade, surging to $2.7 trillion by 2033. This figure has been adjusted to exclude the effects of shifts in the timing of certain payments when the fiscal’s first day, October 1, falls on a weekend. Despite this, the projected cumulative deficit for the 2024-2033 period remains steady at $20.2 trillion, consistent with the CBO's February forecast.

Expressed in relation to the size of the economy, deficits are predicted to grow from 6 per cent of GDP next year to 6.9 per cent in 2033, significantly exceeding their 50-year average of 3.6 per cent of GDP. These projections highlight the urgent need for effective fiscal policy measures to address the burgeoning deficit and ensure long-term economic stability, the report said.

As a result of those deficits, debt held by the public also increases in CBO’s projections, from 98 per cent of GDP at the end of this year to 119 per cent at the end of 2033.

Fibre2Fashion News Desk (KD)