US budget deficit expands to $779 billion in fiscal 2018 as spending surges

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Treasury Secretary Steven Mnuchin testifies on ‘The Annual Report of the Financial Stability Oversight Council’ before the House Financial Services Committee in the Rayburn House Office Building on Capitol Hill February 6, 2018 in Washington, DC.

The U.S. federal budget deficit rose in fiscal year 2018 as spending climbed, the Trump administration said Monday.

The deficit jumped to $779 billion, $113 billion higher than the previous fiscal period, according to a statement from Treasury Secretary Steven Mnuchin and Office of Management and Budget Director Mick Mulvaney. The budget shortfall rose to 3.9 percent of U.S. gross domestic product. The deficit increased by $70 billion less than anticipated in a report published in July, according to the two officials.

Federal revenues rose only slightly, by $14 billion after Republicans chopped tax rates for corporations and most individuals. Outlays climbed by $127 billion, or 3.2 percent higher. A spike in defense spending, as well as increases for Medicaid, Social Security and disaster relief, contributed to the increase.