FX.co ★ US federal budget posts $1.99tn deficit for FY2026 as spending outpaces revenue

The federal budget closed fiscal 2026 with a deficit of $1.99 trillion, the Treasury Department reports. The gap between revenues and outlays widened 12% from last year’s $1.78 trillion. The government spent $7.4 trillion while raising only $5.4 trillion.

Treasury Secretary Scott Bessent has already identified a culprit, blaming the Supreme Court. In February, the justices struck down most of President Trump’s new import tariffs, forcing the administration to refund collections to businesses. The White House is now urgently seeking legislative workarounds to restore the duties.

The near‑$2 trillion deficit has persisted for the fourth consecutive year. It amounts to roughly 6% of GDP, a level economists regard as unusually high given the current low unemployment rate.

Analysts note that last year’s “moderate” deficit reflected accounting effects. In 2025, Republicans tightened student loan rules, and the Treasury booked the paper reduction in loan limits as a real cut in government spending.